Child Tax Credit

Who is it for?
People with dependent children, whether in work or not.

Who pays it?
Calculated by HMRC. Paid direct to ‘main carer’, via bank account

Which leaflet? And how is it claimed?
TC600 claim form and notes, obtained from any tax office or 0845 300 3900 (0845 603 2000 in N.Ireland).

What are the age limits?
Claimant – 16 plus. Child/young person – as per child benefit

National Insurance based?
No.

Means tested?
Yes, but no savings limit. Families with gross income up to £58,000 can still qualify (or £66,000 if child is aged under 1). Based on income from previous tax years (2008/9 for claims made in 2009/10) but can be adjusted using current year income if it  has varied significantly.

How long does it last?
Until end of tax year, then has to be reapplied for. 

What is effect on other benefits?
Counted as income when calculating means-tested benefits such as housing and council tax benefit.

Is it taxable?
No.

Increases for dependants?
Yes.  CTC will be increased if there is a disabled child in the family.

Payable if in EU or other?
CTC payable for limited periods (8/12 weeks) if claimant goes abroad.

Points to watch
Child support is ignored in full as income. New Income Support claimants with children have had to claim CTC since April 2004. Remaining people on income support, which includes amount for children to be switched to CTC in 2011/12.  Big problems remain with overpayments – HMRC should be challenged, especially in cases of official error. Changes of income of up to £25k a year won’t affect that years CTC award, which will reduce the number of overpayments. Civil partners (i.e same sex couples whether they have registered their partnership or not) should be financially assessed as couples from December 2005. CTC stops if child becomes looked-after and cannot be claimed by foster carers (but can be claimed by people who adopt or those with residence or special guardianship orders).

You can view details of benefit amounts on the Community Care Inform website

The A-Z of Benefits 2009 was compiled by Gary Vaux and Community Care Inform