Tax Credits: Social security income

For tax credit purposes, taxable social security benefits are taken into account as income and non-taxable benefits are ignored. The TC600 guidance notes (page 11) show which benefits to include.

State retirement pension is not included here as social security income but HMRC ask for it to be included under 'other income' in box 5.6 of the claim form (see below) - the significance is that the other income category is broadly the Step One equivalent and therefore eligible for the £300 deduction.

Specifically, the following benefits are disregarded for tax credits, together with any child dependency increases payable with them – arranged alphabetically rather than in the order given in the Income Regulations:

* Note - statutory maternity, paternity, adoption, shared parental & sick pay are disregarded as social security income but treated as employment income.

Last reviewed/updated 28 July 2016