Who can claim tax credits?
Tax credits and benefits
On this page we detail everything you need to know about claiming tax credits, including the main conditions of entitlement, joint claims, and claiming while abroad.
The Government is gradually introducing universal credit (UC), a new benefit which will eventually replace tax credits, and some other social security benefits. Universal credit is now available across the UK and most people are no longer able to make a brand new claim for tax credits and are expected to claim UC (or pension credit) instead. Existing tax credit claimants are expected to be moved across to universal credit between 2020 and 2023. This will follow a pilot involving up to 10,000 people who will be moved between July 2019 and July 2020. You can find out more about this in our universal credit section.
The UK left the European Union (EU) on 31 January 2020 and entered a transitional period, currently due to end on 31 December 2020, during which EU law continues to apply in the UK. The UK’s relationship with the EU beyond the end of the transitional period has not yet been finalised. Please note that the guidance below reflects the law as it applied before the UK’s departure from the EU, and as it will continue to apply throughout the transitional period.
New claims for tax credits
Universal credit (UC) is replacing tax credits. The UC full service is now available in all areas of the UK and it is no longer possible for most people to make brand new tax credit claims.
Broadly speaking, the only people who can make brand new claims for tax credits are:
- People who are entitled, or have recently been entitled, to the severe disability premium in income support, income-based jobseeker’s allowance, income-related employment and support allowance or housing benefit.
- People who are ‘frontier workers’. Frontier workers are people who are ‘in Great Britain’ (under Section 4(1)(c) Welfare Reform Act 2012) or ‘in Northern Ireland’ (under Article 9(1)(c) of Welfare Reform (Northern Ireland) Order 2015) but do not reside in either GB or NI. Crown servants or members of HM Forces who are posted overseas (as defined under the UC Regulations 2013) are not frontier workers.
From 1 February, people who have reached their state pension credit qualifying age are no longer permitted to make a new claim for tax credits (even if they meet the exceptions above). This rule also applies if you are part of a mixed age couple (with one person above that age and one below) unless you fall into one of the exceptions mentioned above. People who have reached their state pension credit qualifying age will be expected to claim pension credit, which now also includes elements for children, instead. People who part of a mixed-age couple can claim UC or they can claim pension credit until 15 May 2019 when the age qualifying rules for pension credit will change. This means mixed-age couples will need to claim UC (and not pension credit) from 15 May 2019.
People with three or more children are no longer able to make a brand new claim for tax credits (unless one of the above exceptions applies) and, from 1 February 2019, if they need to make a brand new claim they are expected to claim UC instead.
If you are already claiming working tax credit and want to claim child tax credit or vice versa, you can do so as that does not count as a brand new claim. Similarly, if you are renewing your tax credit claim, that doesn’t count as a brand new claim.
It is generally not possible to claim tax credits and UC at the same time and if you are an existing tax credit claimant and you make a claim for UC then your tax credit award will be terminated and, unless you fall in one of the exceptions above, it is unlikely that you will be able to claim tax credits again.
What are the main conditions for claiming tax credits?
There are some basic conditions that you need to meet to qualify for both working tax credit (WTC) and child tax credit (CTC). These are age, residency and immigration conditions.
- You have to be aged at least 16 years old (although some people will need to be older to claim WTC).
- You must be ‘in the UK’. For WTC this means you must be present and ordinarily resident in the UK. For child tax credit you must be present, ordinarily resident and have a right to reside. There are some exceptions to these basic rules if you live in another EU country. You can find out more about the residence conditions on the GOV.UK website.
- You must not be subject to immigration control, but see below for some exceptions to that rule.
Do I make a joint claim or single claim?
If you are married or in a civil partnership, then both you and your partner must claim together in a joint claim, even if you are temporarily living apart. You must also make a joint claim if you are living with someone as if you were married or civil partners. You are jointly responsible for the claim.
If you do not have a partner or spouse and are not living with someone as if you are married or in a civil partnership, then you can make a single claim.
If you are married or in a civil partnership, you can only make a single claim if you are legally separated or separated in circumstances that are likely to be made permanent.
If you make a single claim, HMRC may investigate your claim. If they have any evidence from their systems or from a credit reference agency that suggests another person is using your address or there are financial links with another person then they may write to you asking for information from you because they think you are living with another person. You can find out more about these investigations on our Revenuebenefits website for advisers.
It is important that you make the correct claim, or if you have a claim already it is important you tell HMRC if your relationship circumstances change otherwise you may be left with a large overpayment. See our repaying an overpayment debt section for more information about repaying overpayments due to relationship changes.
What is the 3-month rule?
From 1 July 2014, a new rule was introduced for child tax credit but it does not apply to claims made (or treated as made) prior to that date.
To meet the basic condition of ‘being in the UK’, you must have been living in the UK for a consecutive period of three months in the period immediately before you claim.
The 3-month rule does not apply if you:
- most recently entered the UK before 1 July 2014
- are a worker or self-employed person in the UK for the proposes of Council Directive 2004/38/EC
- retain the status of a worker or self-employed person in the UK (under the above Directive)
- are a national of Croatia and has a right to reside in the UK as a worker
- are a family member of any of the above
- have been temporarily absent from the UK for a period not exceeding 8 or 12 weeks
- have been temporarily absent for less than 52 weeks and had been ordinarily resident in the UK for a period of at least 3 months prior to that absence
- return to the UK after being abroad and have continued to pay Class 1 or 2 National Insurance contributions during you absence (allowing for a break of up to three months prior to the absence)
- have UK refugee status
- have been granted leave to remain in the UK with recourse to public funds, (including restricted leave to remain pending an application under the domestic violence concession) or humanitarian protection.
Right to Reside
To claim child tax credit (but not working tax credit) you must have a right to reside in the UK.
You will have a right to reside in the UK if you are a national of UK, Republic of Ireland, the Channel Islands or the Isle of Man.
If you are from another EEA country or Switzerland, you will have a right to reside if you are:
- registered as a jobseeker
To have a right to reside as a self-employed person, your work needs to be genuine and effective. To show your work is genuine and effective you will have to show that for the last 3 months you have been earning at least £162 a week. An EEA migrant who has some earnings but not enough to satisfy this minimum earnings threshold will have further checks carried out to see if the work is genuine and effective.
You may also have a right to reside if you are a close relative of someone who has a right to reside.
Can I claim if I live abroad?
If you live outside the UK, you usually cannot claim tax credits. However there are some exceptions. If you live outside of the UK and fall into one of the following categories you may be able to claim (subject to the restrictions above for new claims):
- Crown servants – If you are a Crown servant posted overseas or the partner of a Crown servant posted overseas you may be able to claim tax credits. See the GOV.UK website for more information.
- Receipt of certain UK benefits – If you and your child live in an EU member state and get certain UK benefits you may be able to claim child tax credit. You must get state pension, incapacity benefit, widow’s benefit, bereavement benefit, industrial injuries disablement benefit, contribution based employment and support allowance or severe disablement allowance.
- Cross Border workers – If you live in another country and work in the UK (for example you live in Republic of Ireland but work in Northern Ireland) or you live in the UK but work in another country you may be able to claim working tax credit and child tax credit.
- You may be able to get working tax credit if you live in an EEA country (including Switzerland) and work in the UK or you live in the UK but work in another EEA country.
- You may be able to claim child tax credit if you work in the UK and pay National Insurance as a worker here but your child lives in another EEA country and your child is living with your partner or someone else who depends on you to support them. HMRC will check with the authorities of the EEA country that you live in whether you are claiming any family benefits from them and may reduce the amount of child tax credits payable if the other EU country is also responsible for paying you.
If you are married or in a civil partnership with someone who lives outside the UK and not in another EEA country, you should make a single claim. If they live outside of the UK but in another EEA country, you should contact HMRC before claiming to check with them whether to make a joint or single claim.
You can find further information on the GOV.UK website about claiming if you or your partner live outside of the UK.
What happens if I leave the UK for a short amount of time?
Normally, you need to be present in the UK to claim tax credits. But if you (or your partner) go abroad for up to eight weeks at a time, HMRC will treat you as if you are still in the UK, providing you intend your visit abroad to be temporary. Temporary means you expect it to last less than 52 weeks.
The eight-week period can be extended to a maximum of 12 weeks if you are ill or your trip is in connection with ill-health or the death of a relative.
After the temporary absence period, you will not be treated as being in the UK. This means that if you are part of a couple, you will need to end your joint claim and the partner who remains in the UK will need to make a new single claim. If the 8-week/12-week rule applies, you will need to wait until after that period ends until your partner can claim as a single person, this means that they may not qualify for any childcare support during those 8/12 weeks. Once they make a claim as a single person, only their income will be taken into account, any income from the partner overseas will be ignored.
However, when the overseas partner returns to the UK, the single claim must end and a new joint claim made. This can create numerous problems for people who work overseas for long periods as it can mean switching claims several times a year.
Can I claim if I am subject to immigration control?
If you are not a national of the UK or other European country, you usually need permission to enter and stay in the UK. This means you are likely to be subject to immigration control. You cannot usually claim tax credits if you are subject to immigration control but there are some exceptions to this.
When you arrived in the UK, your passport will have been stamped to show your status. If you are subject to immigration control it may say ‘no recourse to public funds’. If you are unsure of your status, you should contact the UK Visas and Immigration.
You will not be subject to immigration control if:
- you are a UK national
- you are a national of an EEA country or Switzerland
- you are a national of the Republic of Ireland, Channel Islands or Isle of Man
- you have refugee status (after seeking asylum)
- you have been told you are allowed to stay in the UK indefinitely by the Home Office.
Even if you are subject to immigration control, you may still be able to claim tax credits if you have a partner in the UK who is not subject to immigration control or is subject to immigration control but covered by one of the other exceptions. In this case you must make a joint claim but you may not be able to get the second adult element included in your claim.
There are also other exceptions to the immigration rule for other groups such as:
- those who have permission to stay in the UK with a sponsor;
- nationals of certain countries (Algeria, Morocco, San Marino, Tunisia, Croatia, Republic of Macedonia, Turkey) if certain conditions are met;
- people claiming CTC who receive financial support through certain DWP benefits and claimed asylum before 5 February 2006;
- people granted the 'destitute domestic violence' concession from the Home Office. Where this is granted, the no recourse to public funds restriction is lifted.
This section of the site gives a brief overview of the basic conditions for claiming tax credits. For more detailed information, visit the following pages on our website for advisers: