Accredited official statistics

Child and Working Tax Credits Finalised Annual Awards 2005 to 2025 Background and Definitions

Published 25 September 2025

1. Introduction to tax credits

Tax credits were a system of financial support for families based on their specific circumstances.

The system, introduced in 2003, formed part of wider government policy to provide support to parents returning to work, reduce child poverty and increase financial support for families. The design of the system meant that as families circumstances change, so did (daily) entitlement to tax credits.

Tax credits were made up of Working Tax Credit (WTC) and Child Tax Credit (CTC). These were based on household circumstances and could be claimed jointly by couples or by single adults, whether or not they had children. Entitlement was based on the following factors:

• age
• income
• hours worked
• number and age of children
• childcare costs
• disabilities

Tax credits ended on 5 April 2025.

2. About this publication

2.1 Overview publication

This publication covers individual or couples (described as families) who had claimed, and were eligible for, CTC (or the equivalent via benefits) or WTC for all or part of the tax year reported from tax year ending 2005.

Previous HMRC statistics on tax credits were published as provisional or finalised awards, where provisional awards were the caseload position at a snapshot in time and finalised awards were a complete retrospective picture for the year once all family income and circumstances were known.

Across the 20 year period of producing these statistics, the production process was subject to various changes making comparison across the timeseries difficult. This publication applies a new consistent methodology across all years to allow comparison between years. This means that statistics in this publication may differ to previously published figures. In all cases, this publication should be used over previously published statistics. A list of changes in methodology are explained in the ‘Comparison to previous finalised publications’ below.

This publication covers Tax Credits statistics from tax year ending 2005. While HMRC also holds some data for tax year ending 2004, this has not been included in the publication as it was based on a small sample of claimants and had previously only been used to estimate figures to the nearest 100,000.

2.2 Nominal figures

These statistics are nominal figures, which means they reflect the value (£) of awards at the time and do not consider inflation, meaning they are not strictly comparable between years.

2.3 Main data tables

The main data tables include number of families and their entitlement for the following breakdowns:

• tax year ending
• in and out of work families
• tax credit group
• family composition (single and couples)
• number of children and disabled children
• number of disabled workers
• number of severely disabled adults
• eligible childcare band
• tax credit element
• income band
• impact of income change

2.4 Main tidy data

The data is also available in a ‘tidy’ format to make comparisons between years easier and to include additional breakdowns.

‘Tidy’ data is a flat comma-separated values (CSV) file, which can be used within any program that handles spreadsheets, like Microsoft Excel. It can also be easily read into programs like R, Python and Statistical Analysis System (SAS) without cleaning the data.

The main tidy data is split out into 3 files:

• in and out of work families
• tax credits elements
• income used to taper awards (in work families only)

2.5 Geography tidy data

There is an additional tidy data file with figures broken down by the following geographical levels:

• Country and English Region
• Local Authority (LA)
• Westminster Parliamentary Constituency
• Scottish Parliamentary Constituency
• Lower Super Output Area (LSOA)

Some breakdowns are not available at lower geographical levels due to the risk of identifying a small number of families at these geographies.

Due to concerns around data quality, Scottish Parliamentary Constituency data is only available from tax year ending 2006 onwards.

3. Comparison to previous finalised publications

This publication applies a consistent methodology to the entire timeseries that may be different to that used in previously published finalised statistics. Some of the possible reasons and impacts for this are given below.

3.1 Exclusion of family premia Department for Work and Pensions (DWP) data

DWP family premia data covers Income Support and Job Seekers Allowance families paid by DWP whilst waiting to migrate over to CTC and was historically included in HMRC tax credits statistics to ensure a consistent timeseries once these families had migrated to CTC. These cases have now been removed from the figures as the data is separately collected by DWP and not directly related to HMRC tax credits.

Example of impact of removal of family premia on figures

The removal of the family premia data has had a large impact on figures for out of work families with children. For example, previously published figures for tax-year-ending 2006 show an average of 1.4 million out-of-work families with children, whilst the corresponding figure for the new timeseries is 757,000.

Previously published data split out the ‘out-of-work families with children’ total into ‘receiving CTC’ and ‘receiving family premia in benefits’. The new figure for out-of-work families is equal to the old ‘receiving CTC’ figure, showing the large differences seen in out-of-work families with children are the result of the removal of the family premia data.

3.2 £26 de minimis

Tax credits required a minimum entitlement of £26 across each period of entitlement for a claim to receive payment, known as the ‘£26 de minimis’. The £26 de minimis was not accounted for in all previously published figures, resulting in applications with an annual award less than £26 being counted. These cases have been filtered out, mostly affecting the years up to tax year ending 2011.

3.3 Missing family composition data (tax years ending 2005 and 2006 only)

Some data on the number of adults in each application is missing for tax years ending 2005 and 2006. These families were previously all counted as singles. For this publication, the methodology has been updated to use the number of adults for the corresponding application in the following year’s data. Where this was not possible, these families have continued to be treated as singles, as all families require a weight to calculate the final figures.

3.4 Recode of families with annual entitlement less than the family element (tax year ending 2017 only)

In previous publications, for tax year ending 2017 only, families with annual entitlement equal to or less than the family element were filtered out of tax credit element breakdowns. For this publication, these have now been recoded so they are included in all counts.

3.5 Calculation of income thresholds

The income thresholds used to calculate figures by income band in this publication have been updated to:

• use calculator computed thresholds instead of hard coded figures
• take into account leap years

3.6 Childcare band calculation

The childcare element bands were originally calculated incorrectly. This issue was corrected in published data from 2017 onwards. These changes were never made to revise past data, so this publication uses the new banding calculation across the whole time series so they can be compared. This results in a change in the childcare element data up to and including tax year ending 2016.

3.7 Rounding and suppression

Rounding and suppression the in the data files differs between the main tables, main tidy, and main geographical tables. This means that exact figures may be different between the files.

In the main data tables, the number of families and children are:

• rounded to the nearest 1000
• suppressed if under 500

In the main tidy data, the number of families and children are:

• rounded to the nearest 100
• suppressed if under 50

In the geography tidy data, the number of families and children are:

• rounded to the nearest 5
• suppressed if under 3

The most recent finalised published used rounding to nearest 100 families in the main tables and the nearest 5 families at LSOA level. For this publication, all figures on numbers of families have been rounded to the nearest 5 for consistency.

3.8 Removing de-duplication of dividing by total days in year

SAS code used in previous publications to calculate the derived income and previous year derived income variables by dividing the income amounts by the total days in the year, before then dividing again by the total days in the year for the minimum awards calculation. The code has been updated to divide by total days in the year once in the calculation.

This change impacts the derived income calculations for tax years ending 2014 and 2017.

3.9 Weighting used to calculate geographical breakdowns

Previous publications used Child Benefit data and 10% interim data (before tax year ending 2021) to estimate missing geography information. In cases where geography was sourced from the 10% sample interim data, the 10% weighting (either 5 or 10) was also used. This was intended to represent the geography unknowns that were not found in the 10% sample .However, after investigation, we believe that this method was inaccurate in representing the missing geographies. For this publication, all geography data was instead calculated with each family weighted as one. This brings geography totals in line with the main totals, but has increased the number of foreign and not known cases compared with previous publications.

3.10 Using geography as recorded in raw tax credits data

ONS geography codes have been updated several times since HMRC started collecting Tax Credits data. Sometimes the geography codes found in the raw tax credits data from the time do not match the ONS geography codes from the time. In these cases, this publication uses the ONS codes found in the raw data over ONS codes from the exact period.

This includes:

• using older Northern Ireland LA codes until tax year ending 2017 as a lookup to new codes does not exist
• using older LA codes in tax years ending 2012 and 2013

The exception to this is for tax year ending 2011, where new LA and Parliamentary Constituency were used to keep these figures comparable with geography for other years.

3.11 Reliability of lower level geographies in Northern Ireland (before tax year ending 2009)

Before tax year ending 2009, around 2% of Northern Ireland lower level geography (LA, Westminster Parliamentary Constituency) may be associated with the incorrect postcode within Northern Ireland due to data collection issues. This does not affect the higher level geography (region, country) for these years.

4. Tax credits explained

4.1 WTC

WTC provided in-work support for people on low incomes, with or without children. It was available as in-work support to people who were aged at least 16 and either:

• were single, worked 16 or more hours a week and were responsible for a child or young person
• were in a couple and were responsible for a child or young person where their combined weekly working hours were at least 24, with one claimant working at least 16 hours
• worked 16 or more hours a week and were receiving or had recently received a qualifying sickness or disability related benefit and had a disability that put them at a disadvantage of getting a job
• worked 16 or more hours a week and were aged 60 or over

Otherwise, it was available for people aged 25 and over who worked 30 hours a week or more.

WTC was made up of the following elements:

• basic element: which was paid to any working person who met the basic eligibility conditions
• lone parent element: for lone parents
• second adult element: for couples
• 30 hour element: for individuals who work at least 30 hours a week, couples where one person works at least 30 hours a week or couples who have a child and work a total of 30 hours or more a week between them where one of them works at least 16 hours a week
• disability element: for people who worked at least 16 hours a week and who had a disability that put them at a disadvantage in getting a job and who were receiving or had recently received a qualifying sickness or disability related benefit
• severe disability element: for people who were in receipt of DLA (Highest Rate Care Component), PIP (Enhanced Daily Living Component) or Attendance Allowance at the highest rate
• childcare element: for a single parent who worked at least 16 hours a week, or couples who either both worked at least 16 hours a week, or one of them worked at least 16 hours a week but the other was out of work for being in hospital or in prison and who was spending money on a registered or approved childcare provider

Table 1: WTC element annual rates (£), from tax year ending 2005

Tax year ending	Basic element	Couples and lone parent element	30 hour element	Disabled worker element	Severely disabled adult element
2005	1,570	1,545	640	2,100	890
2006	1,620	1,595	660	2,165	920
2007	1,665	1,640	680	2,225	945
2008	1,730	1,700	705	2,310	980
2009	1,800	1,770	735	2,405	1,020
2010	1,890	1,860	775	2,530	1,075
2011	1,920	1,890	790	2,570	1,095
2012	1,920	1,950	790	2,650	1,130
2013	1,920	1,950	790	2,790	1,190
2014	1,920	1,970	790	2,850	1,220
2015	1,940	1,990	800	2,930	1,255
2016	1,960	2,010	810	2,970	1,275
2017	1,960	2,010	810	2,970	1,275
2018	1,960	2,010	810	3,000	1,290
2019	1,960	2,010	810	3,090	1,330
2020	1,960	2,010	810	3,165	1,365
2021	3,040	2,045	825	3,220	1,390
2022	2,005	2,060	830	3,240	1,400
2023	2,070	2,125	860	3,345	1,445
2024	2,280	2,340	950	3,685	1,595
2025	2,435	2,500	1,015	3,935	1,705

From 6 April 2020 until 5 April 2021, the basic element of WTC was increased by £1,045 to £3,040 to provide greater support to families during the COVID-19 pandemic.

Table 2: WTC childcare element rates, from tax year ending 2005

Tax year ending	Maximum eligible costs per week for 1 child (£)	Maximum eligible costs per week for 2 or more children (£)	Percentage of eligible costs covered
2005	135	200	70%
2006	175	300	70%
2007 to 2011	175	300	80%
2011 onwards	175	300	70%

Until 6 April 2012, the 50 plus return to work payment was payable for each qualifying adult for the first 12 months following a return to work.

Table 3: WTC 50 plus return to work payment rates (£), from tax year ending 2005 to tax year ending 2012

Tax year ending	Between 16 and 30 hours worked per week	At least 30 hours worked per week
2005	1,075	1,610
2006	1,110	1,660
2007	1,140	1,705
2008	1,185	1,770
2009	1,235	1,840
2010	1,300	1,935
2011	1,320	1,965
2012	1,365	2,030

4.2 CTC

CTC provided income-related support for children and qualifying young people aged between 16 and 19 who were in full time, non-advanced education or approved training into a single tax credit, payable to the main carer. Families could claim CTC whether or not the adults were in work.

CTC was made up of the following elements:

• family element: which was the basic element for families responsible for one or more children or qualifying young people —from 6 April 2017, this element was only payable to families with at least one child born before this date
• child element: which was paid for each child or qualifying young person the claimant is responsible for — from 6 April 2017, this element was no longer payable in respect of third or subsequent children who were born after this date. Certain exceptions to this rule apply and are set out at GOV.UK.
• disability element: for each child or qualifying young person the claimant was responsible for if Disability Living Allowance (DLA) or Personal Independence Payment (PIP) was payable for the child, or if the child was certified as blind or severely sight impaired
• severe disability element: for each child or qualifying young person the claimant was responsible for if DLA (Highest Rate Care Component), or PIP (Enhanced Daily Living Component) was payable for the child
• baby addition to family element: until 6 April 2011, this was payable to families for any period during which they have one or more children aged under 1.

Table 4: CTC element annual rates (£), from tax year ending 2005

Tax year ending	Family element	Baby addition to the family element	Child and young person element	Disabled child element	Severely disabled child element
2005	545	545	1,625	2,215	890
2006	545	545	1,690	2,285	920
2007	545	545	1,765	2,350	945
2008	545	545	1,845	2,440	980
2009	545	545	2,085	2,540	1,020
2010	545	545	2,235	2,670	1,075
2011	545	545	2,300	2,715	1,095
2012	545	0	2,555	2,800	1,130
2013	545	0	2,690	2,950	1,190
2014	545	0	2,720	3,015	1,220
2015	545	0	2,750	3,100	1,255
2016	545	0	2,780	3,140	1,275
2017	545	0	2,780	3,140	1,275
2018	545	0	2,780	3,175	1,290
2019	545	0	2,780	3,275	1,325
2020	545	0	2,780	3,355	1,360
2021	545	0	2,830	3,415	1,385
2022	545	0	2,845	3,435	1,390
2023	545	0	2,935	3,545	1,430
2024	545	0	3,235	3,905	1,575
2025	545	0	3,455	4,170	1,680

4.3 Tapering and entitlement

Tapering was the amount of the award that was reduced when the household income exceeded a given threshold.

The amount of support an eligible family can receive (known as their entitlement) varied depending on their income and their eligibility for specific tax credit elements.

First, a family’s maximum possible entitlement was worked out by adding up all the different elements of CTC and WTC that they are eligible for.

A household’s actual entitlement was then determined by tapering this maximum amount according to different thresholds. Families eligible for the WTC receive the full entitlement until their annual household income reaches the lowest income threshold for that tax year, after which the amount of tax credits they receive is reduced by the income threshold rate for each £1 they earn beyond this threshold.

If a household was eligible for CTC only, they would receive the full entitlement until their annual household income reached the lowest income threshold for that tax year. After this point, the amount of tax credits they receive was reduced by the income threshold rate for each additional £1 of income beyond this threshold.

Tax credits were based on the taxable income of adults within the family. The income used to calculate the award was based on the families income from the previous tax year, or on their most recently reported circumstances in-year. An increase to the income rise threshold in annual income and a decrease to the increase fall disregard in annual income between the previous or current year was disregarded in the calculation.

For example, in tax year ending 2023, families eligible for WTC received the full entitlement until their annual household income reached £6,770, after which the amount of tax credits they received was reduced by 41 pence for each £1 they earnt beyond this threshold. If a household was eligible for CTC only, they received the full entitlement until their annual household income reached £17,005. After this point, the amount of tax credits they receive is again reduced by 41 pence for each additional £1 of income beyond this threshold. Up to £2,500 of any change in annual income between the previous or current year was disregarded.

Table 5: Tax credits income thresholds and withdrawal rates (£), from tax year ending 2005

Tax year ending	First income threshold (£)	First income threshold rate	Threshold for those entitled to CTC only	Income increase disregard (£)	Income decrease disregard (£)
2005	5,060	37%	13,480	2,500	0
2006	5,220	37%	13,910	2,500	0
2007	5,220	37%	14,155	25,000	0
2008	5,220	37%	14,495	25,000	0
2009	6,420	39%	15,575	25,000	0
2010	6,420	39%	16,040	25,000	0
2011	6,420	39%	16,190	25,000	0
2012	6,420	41%	15,860	10,000	0
2013	6,420	41%	15,860	10,000	2,500
2014	6,420	41%	15,910	5,000	2,500
2015	6,420	41%	16,010	5,000	2,500
2016	6,420	41%	16,105	5,000	2,500
2017	6,420	41%	16,105	2,500	2,500
2018	6,420	41%	16,105	2,500	2,500
2019	6,420	41%	16,105	2,500	2,500
2020	6,420	41%	16,105	2,500	2,500
2021	6,530	41%	16,385	2,500	2,500
2022	6,565	41%	16,480	2,500	2,500
2023	6,770	41%	17,005	2,500	2,500
2024	7,455	41%	18,725	2,500	2,500
2025	7,955	41%	19,995	2,500	2,500

Until 6 April 2012, for those entitled to CTC, the award was reduced down to the family element (plus the baby addition where relevant) minus the second income threshold rate for each additional £1 of income beyond the second income threshold.

Table 6: Tax credits second income thresholds and withdrawal rates (£), from tax year ending 2005 to tax year ending 2012

Tax year ending	Second income threshold (£)	Second income threshold rate
2005	50,000	7%
2006	50,000	7%
2007	50,000	7%
2008	50,000	7%
2009	50,000	7%
2010	50,000	7%
2011	50,000	7%
2012	40,000	41%

Tax credits required a minimum entitlement of £26 across each period of entitlement for a claimant to receive payment, known as the ‘£26 de minimis’.

A family’s tax credits award was provisional until finalised at the end of the year, when it was checked against their final income for the year.

5. Policy changes

5.1 Two child limit

In the 2015 Summer Budget, the government announced that the child element of Child Tax Credit (CTC) would be limited to 2 children for those born on or after 6 April 2017 unless certain exceptions apply. Prior to 6 April 2017, the child element of CTC was paid for each child or qualifying young person that the claimant (or his or her partner) was responsible for.

The change meant that any family with 2 or more existing children did not receive any child element for children born on or after that date, subject to exceptions. The child element of CTC continued to be paid for all children born before 6 April 2017.

In addition, any family having their first child born on or after 6 April 2017 did not receive the family element (worth up to £545 a year) of CTC. The family element was previously paid to all families. From 6 April 2017, it was only paid where the claimant is responsible for at least one child or qualifying young person born before 6 April 2017.

For further information, please visit the CTC exceptions to the 2 child limit page on GOV.UK.

Statistics related to this policy can be found on the Official Statistics page on GOV.UK.

5.2 Response to COVID-19 pandemic

During 2020, the COVID-19 pandemic led to some changes in the tax credit system which may have had an impact on these statistics.

As part of a number of measures to support the country, the basic element of WTC was increased by £1,045 to £3,040 from 6 April 2020 until 5 April 2021. The amount a claimant or household benefited from this depended on their circumstances, including their level of household income, how many children they are responsible for and if they are disabled.

However, claimants will have received an increase of up to £20 each week. The temporary increase moved many claimants from nil to positive awards at the start of April 2020.

6. Universal Credit

Universal Credit (UC) is a payment to help with living costs for those on a low income or out of work. UC was introduced in April 2013 in certain areas of North West England. Since October 2013, it has progressively been rolled out to other areas.

Claimants receive a single monthly household payment, paid into a bank account in the same way as a monthly salary and support for housing costs, children and childcare costs are integrated into UC.

CTC will be replaced as UC rolls out. Since December 2018 there have been no new tax credit claims (with the exception of a small number of families claiming the family premium).

Further information about UC, including making a claim, is available online on the UC page on GOV.UK.

Statistics related to UC are available online and can be found on the UC statistics page on GOV.UK.

7. Using these statistics

The statistics contained in this publication will be of interest for anyone that is looking for the most comprehensive data on Tax Credits. Specifically, there are aggregate statistics on who received what level of tax credits support and the amount of that support, as well as breakdowns of both by various sub-categories - for example, family composition, family income, work status, and geographical analyses. It may be of interest to academics, think tanks, political parties interested in the twin aims of Tax Credits: eradicating child poverty and improving work incentives. Equally, it may be of interest for people considering wider questions on government support systems and/or others designing benefit systems. Finally, the geographical analyses might be of interest at the more local level, giving some indication of the level of government support in each Region/Local Authority level.

8. Disclosure control

To avoid the possible disclosure of information about individual families, values have been suppressed when underlying sample counts are low. An entry of [z] or [low] in a table indicates that the data has been rounded down to 0, or holds a negligible value just above zero, or has been withheld in line with HMRC’s Dominance and Disclosure policy.

9. User engagement

Bespoke analysis of tax credits data is possible although there may be a charge depending on the level of complexity and the resources required to produce.

If you would like to discuss your requirements, to comment on the current publications, or for further information about the tax credits statistics please use the contact information at the end of this publication, or from the Statistics at HMRC page.

We are committed to improving the official statistics we publish. We want to encourage and promote user engagement, so we can improve our statistical outputs.

We would welcome any views you have by email to the below address. We will undertake to review user comments on a quarterly basis and use this information to influence the development of our official statistics. We will summarise and publish user comments at regular intervals.

benefitsandcredits.analysis@hmrc.gov.uk.

10. Contact details

Benefits and credits statistics

Media contact: HMRC Press Office

Statistical contact: J Martin