Tax credits – renew by the 31 July deadline
The tax credit renewal deadline is fast approaching. If you claimed tax credits during 2022/23 and have received renewal forms from HMRC, you need to act by 31 July to make sure HMRC renew your tax credits and your payments can carry on.
Content on this page:
Why do I have to renew?
The tax credits renewals process does two things: it finalises tax credit awards for the tax year that has just ended (2022/23) and it sets up the claim for the current tax year (2023/24).
It is important you take any action necessary as soon as possible so that HMRC know how much to pay you for the rest of the year. Even if you are no longer entitled to tax credits, if you have received a renewal pack from HMRC you must still follow the instructions in it so HMRC can finalise your 2022/23 award.
What do I have to do?
If you claimed tax credits at all during 2022/23, even if you did not receive any payments, you will receive renewal papers; you should follow HMRC’s instructions to finalise the claim for 2022/23 and, if necessary, set up your claim for the current tax year (2023/23). If you think you should have received a renewal pack and haven’t had it yet, you should contact HMRC straightaway.
Renewal packs with a red line
Some claimants will receive a renewal form which has a red line across it and an instruction to ‘reply now’, with accompanying guidance notes. These are known as ‘reply-required’ renewals. If you get one of these, you must respond to HMRC by 31 July.
Renewal packs with a black line
Other claimants will receive a renewal form with a black line across it and an instruction to ‘check now’. If you get one of these (known as ‘auto-renewals’) HMRC will automatically finalise your 2022/23 award and renew your claim for 2023/24 on 31 July, using the details they already hold. However, it is important that you check the information; and you must still contact HMRC if something on the form is wrong or you have had a change of circumstances.
Income
You should check the renewal documents and the notes that come with them carefully. Some of the renewal documents will show income figures that HMRC have obtained from their tax system so they may not include some deductions that are allowed for tax credits. You should read the notes carefully to see if any deductions apply to you.
If you do not know your actual income for 2022/23 yet, you must still submit an estimate of your income by 31 July and then contact HMRC again by 31 January 2024 to either confirm the estimate is correct or replace it with the correct actual figure.
If you claimed tax credits during 2022/23 and went on to claim universal credit also during 2022/23, HMRC should have already finalised your 2022/23 tax credit award and so you won’t get another renewal pack.
If you have claimed universal credit since 6 April 2023, you may find you have two packs to complete: one to finalise the award for 2022/23 and to make the claim for the new tax year 2023/24 and the other to finalise the award for the current year (2023/24) between the 6 April and the date you made your universal credit claim.
How do I renew?
You can renew your tax credits online, via the HMRC App, by telephone or through the post.
HMRC’s online service can be found on the official GOV.UK website, either via your Personal Tax Account (use your existing one or set one up if you don’t have one yet) or by going directly to the Manage your tax credits service (via the GOV.UK website).
HMRC’s tax credit telephone line gets very busy at this time of year, so it is worth bearing in mind that the online channel and the HMRC app are both available 24 hours a day.
Unfortunately, this time of the year sometimes sees an increase in fraudulent activity which often targets the most vulnerable taxpayers. Please remember that tax credits can only be renewed using the official HMRC phone number, GOV.UK, the HMRC App or by post to HMRC’s Tax Credit Office.
What if I miss the deadline?
If you were required to reply to HMRC by 31 July and you miss the deadline, you might have to repay to HMRC all of the tax credits payments you have received since the start of this tax year in April.
Once the 31 July deadline passes, if you have not renewed your claim, HMRC stop payments and issue a letter called a Statement of Account. If you contact HMRC within 30 days of the date on the Statement of Account, they can reinstate your renewal from 6 April 2023.
If you don’t contact HMRC within those 30 days, then you will have to pay back all payments made from 6 April and your tax credits will stop. New claims for tax credits are no longer accepted so ongoing support will be available mainly through claiming universal credit or pension credit, depending on your age and circumstances.
If you miss the renewal deadline and the 30-day grace period but do reply by 31 January 2024, you may be able to have your tax credit claim renewed and reinstated from April 6 2023 but only if you can show HMRC you had good cause for missing the earlier deadlines. In these cases, if you have since claimed universal credit, your tax credits will only be renewed up until the date you claimed universal credit.
What about universal credit?
Universal credit is gradually replacing tax credits, and some other benefits, for working-age people, with pension credit available where people meet the age requirements.
Apart from renewals, brand new claims for tax credits are no longer accepted and so you need to claim universal credit or pension credit instead. People currently getting tax credits are gradually moving over to universal credit (or pension credit) either because they have a change of circumstances that requires a fresh claim, they choose to move over (it can be advantageous) or they are selected to move in the formal managed migration exercise.
The managed migration exercise is now taking place. It is being introduced gradually to start with and it is currently expected that most tax credit claimants will have either moved or been asked to move to universal credit by the end of the 2024/25 tax year. This formal managed migration exercise involves DWP/HMRC issuing a letter called a ‘migration notice’ to tax credit claimants. The notice tells the claimant that their tax credits award will be ending and, to receive continuing support, they should make a claim for universal credit, with instructions about timeframes and what actions to do.
It is possible that tax credit claimants will receive their migration notice while they are also dealing with their usual tax credit renewal.
If this happens to you, you should follow the instructions on both the tax credit renewal and the migration notice. However, if you have any questions or need any support around making your universal credit claim, we recommend you contact a welfare rights adviser in one of the local organisations, where they will be able to help you or point you in the direction of how to get help with your claim.