Working tax credits
Working tax credit is being replaced and most people now have to claim universal credit instead.
Having said that, if you work and you’re on a low income, there are still some situations where you might be able to get working tax credit to top up your earnings.
Find out if you can get working tax credit, how much you’ll get and how it’s being phased out.
Can I get working tax credit?
Universal credit has replaced working tax credit for most people.
But you might still be able to apply for working tax credit if you get child tax credit.
To get working tax credit, you have to work at least 16 hours a week and be on a low income.
Exactly how many hours you have to work and what counts as a low income depends on your circumstances.
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Hours you must work to get working tax credit
| Situation | Hours a week |
| Aged 25 - 29 | At least 30 |
| Aged 60 or over | At least 16 |
| Disabled | At least 16 |
| Single with at least one child | At least 16 |
| Couple with at least one child | Usually at least 24 between you, with one of you working at least 16 |
Exceptions for couples with at least one child
You may still be able to apply for working class credit if you and your partner work less than 24 hours a week between you, provided you work at least 16 hours a week and one of the following also applies:
- you’re disabled
- you’re 60 or over
- your partner gets certain disability or ill health benefits
- your partner is entitled to carer’s allowance or carer support payment (Scotland)
- your partner is in prison or hospital
What counts as work?
- being an employee
- being a worker
- being self-employed
- a mixture of those things
Working tax credit if you’re self-employed
If you’re self-employed and you want to claim working tax credit, there are certain criteria you’ll need to meet.
You must be:
- trying to make a profit
- working regularly
- working in an organised way
In practise, this means you must:
- be making money through your work or have clear plans on how your work will end up making you money
- keep business records, such as receipts and invoices
- follow any necessary regulations e.g. having the right licence or insurance
If you’re earning less than the national minimum wage for your self-employed work, you may be asked to provide:
- business records
- your business plan
- details of how you run your business on a day-to-day basis
- evidence you’ve promoted your business e.g. adverts
Working tax credit and pay
For the work you do to meet working-tax-credit eligibility criteria, it must be paid. It must also last (or you must expect it to last) for at least four weeks.
Payment in kind counts as pay e.g. if you work on a farm and receive produce from the farm for your labour rather than money.
Exceptions to paid work
These things do not count as paid work:
- money made through the Rent a Room scheme
- work done in prison
- receiving a grant for training or studying
- receiving a sports award
Hours you must work to get working tax credit
You might be able to get up to 70% of your childcare costs covered if you’re getting working tax credit.
If you’re in a couple, both of you will need to be working at least 16 hours each to qualify.
You generally need to use registered or approved childcare. This can include nurseries, playgroups and childminders.
In the 2023-24 tax year, the maximum weekly limits for working-tax-credit childcare costs are:
| Number of children | Maximum weekly limits |
| One | £175 |
| More than one | £300 |
You won’t necessarily get the maximum amount. How much you get will depend on:
- the hours you work
- your income
- how much you spend on childcare
Applying for working tax credit
If you already get child tax credit, you can make a claim for working tax credit.
Do this by updating your existing tax credit claim online or by phone.
If you can’t make a claim for working tax credit, you may be able to get universal credit instead.
Switching from working tax credit to universal credit
You may move from working tax credit to universal credit for a few of reasons:
- a change in circumstances
- because you’ve been told to by the Department for Work and Pensions (DWP)
- because you want to
A change in circumstances
Changes in circumstances that may affect your working tax credit include things like:
- a partner moving in or out
- losing or getting a job
- having a baby
You must tell HMRC about changes like this within 30 days and they may ask you to make a new claim for universal credit. They’ll tell you how to go about this.
DWP tell you to switch
You might receive a letter from DWP asking you to switch to universal credit within three months of the date on the letter. This is called a migration notice.
The letter will explain what you need to do.
If you’re asked to move by DWP, you shouldn’t be worse off on universal credit to begin with. Even if the amount you’re entitled to is less, your payment will be topped up to make sure you don’t lose you.
These top-ups are known as transitional protection.
Choosing to switch
You can choose to move to universal credit before being asked to by DWP. This is called voluntary migration.
It’s important to make sure you’ll be better off on universal credit than working tax credit before you apply, as once you switch you won’t be able to go back.
Also, if you choose to move voluntarily, you won’t get transitional protection.
Use our free benefits calculator to find out if you’ll be better or worse off on universal credit.
FAQs
As universal credit is replacing working tax credit, the only chance you’ll be able to apply for it now is if you’re already getting child tax credit.
To claim tax credits if you’re under 25, you must work at least 16 hours a week and either be:
- responsible for a child under the age of 16
- eligible for the disability element
Check the government’s tax credits eligibility helpsheet to see if you qualify for the disability element.
There’s no set income limit to get working tax credit. It depends on your situation. The income limit for a couple without children is £18,000 a year. For a single person without children, you can earn up to £13,100. But your income can be higher than this if you have children, pay for approved childcare or either you or your partner are disabled.
There’s no set income limit to get working tax credit. It depends on your situation. The income limit for a couple without children is £18,000 a year. For a single person without children, you can earn up to £13,100. But your income can be higher than this if you have children, pay for approved childcare or either you or your partner are disabled.
Working tax credit is designed to top up the earnings of people on a low income. You might be able to claim working tax credit alongside a range of other benefits.
Universal credit aims to make the welfare system simpler for those who are out of work or on a low income by replacing six benefits with a single monthly payment. It includes support for housing costs, children and childcare, the disabled and carers.
If you move to universal credit after receiving a migration notice from DWP, you shouldn’t be worse off to start with. Even if you’re entitled to less money on universal credit, your payment will be topped up to make sure you don’t lose you. These top-ups are known as transitional protection.
If you choose to switch to universal credit before being asked by DWP, you won’t receive transitional protection, so it’s important to check you won’t be worse off before you make the switch. Once you’ve moved to universal credit, you can’t go back
Check if you’ll be better or worse off using our free benefits calculator.
You’re classed as a couple if you’re:
- married
- in a civil partnership
- living together
If you’re having a break from your partner while you decide whether you have a future together but you’re still legally married, you’ll need to make a joint claim. You’ll be treated as a couple unless you’re:
- divorced
- legally separated under a court order
- permanently separated (you have no plans to get back together)
You may be able to get other benefits if you’re receiving working tax credit. Check what you’re entitled to using our free benefits calculator.