Tax credit u-turn for families with disabled children

Families with disabled children will be exempt from changes to working tax credits after a government u-turn on the issue ahead of today's budget.

March 21, 2012 in Adults

Families with disabled children will be exempt from changes to working tax credits after a government u-turn on the issue ahead of today’s budget.

Under the changes, due to come into effect in April, couples will have to increase their working hours from 16 to 24 to qualify for working tax credits, with those unable to do so facing a weekly income drop of up to £74.

Charities have campaigned for families with disabled children to be exempt, pointing out that many parents have caring responsibilities which prevent them from working extra hours.

The government appears to have listened, publishing new regulations this week confirming that couples will continue to receive the credits if one partner works 16 hours per week and their partner is entitled to Carer’s Allowance.

It was the benefit change most people were worried about, according to a survey of more than 2,000 families by Contact a Family.

“We are delighted the government has seen sense on this issue,” said Srabani Sen, chief executive of Contact a Family. “Contact a Family has campaigned hard on behalf of parents to highlight the unfairness of the proposed changes.”

As well as the obvious challenges with the economic situation and high unemployment, she explained, couples with disabled children have less scope to work extra hours than other parents because of their substantial caring responsibilities.

“Yesterday’s concession will ensure that hard working families, working in paid employment and caring for a disabled child at home, won’t be worse off,” Sen said.

The government also amended the rules on childcare costs, opening up childcare to a new group. From April, childcare can be included in a tax credit claim where one partner works 16 hours a week and their partner is entitled to carer’s allowance.