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Changes that affect your tax credits
Overview
Your tax credits could go up, down or stop if there are changes in your family or work life.
You must report any changes to your circumstances to HM Revenue and Customs (HMRC).
Do this as soon as possible to make sure you get the right amount of tax credits. You’ll have to pay back the money if you’re overpaid.
You could be fined up to £300 if you do not report certain changes within 1 month, and up to £3,000 if you give wrong information.
You can report any changes either:
When you contact HMRC
Make sure you have as much information as possible about the change in circumstances. For example, if you’ve changed jobs you’ll need your employment dates and PAYE reference number for both jobs.
Why your tax credits change
Your payments can go up if:
- your income goes down by more than £2,500
- your benefits stop or go down
- you start getting personal independence payment (PIP), Disability Living Allowance (DLA) or other disability benefits for yourself or a child
- you have a child
- your childcare costs go up
You should report these changes within 1 month to make sure you get everything you’re entitled to. Payments cannot usually be backdated any further than this.
Your payments can go down or stop if:
- your income goes up by more than £2,500 - report this straight away to reduce the amount you’re overpaid
- you have not renewed your claim
- your award notice shows you’ve been overpaid
- you stop getting PIP, DLA or other disability benefits for yourself or a child
- your child is now 16, 18 or 19 and you have not told HMRC they’re in approved education or training
- your childcare costs go down
- you or your partner start claiming Universal Credit