What is Working Tax Credit?

Working Tax Credit (WTC) tops up the pay of low-paid workers (employed or self-employed). You can claim it separately or together with Child Tax Credit (but you use only one claim form). Tax credits are being gradually replaced by Universal Credit.

WTC is made up of a basic award (£1,960 per year in 2017-18), plus extra amounts (known as 'elements') for:

  • couples applying together;
  • single parents;
  • people who work 30 or more hours a week (if you are part of a couple, you can combine hours to qualify for this element);
  • disabled workers (who pass the 'disadvantage' test and are in receipt of or have recently received certain disability benefits);
  • people with a severe disability; and
  • people who use registered or approved childcare who need help with childcare costs.

To qualify for WTC, you will need to be working at least 16 hours a week, but, for a couple with one or more children, usually it's at least 24 hours between you (there are exceptions), with one of you working at least 16 hours, otherwise for someone aged 25-59, you must work at least 30 hours a week.

Other conditions are that you are aged 16 or over and you or your partner have responsibility for a child; or have a disability that puts you at a disadvantage in getting a job, and are in receipt of or have recently received certain disability benefits.

If none of these apply, then you must be aged 25 or over and working at least 30 hours a week. The Money Advice Service explains all these conditions in more detail.

Note: This content is provided as general background information and should not be taken as legal advice or financial advice for your particular situation. Make sure to get individual advice on your case from your union, a source on our free help page or an independent financial advisor before taking any action.

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