Do you have children at home or a low income job? If so, you may qualify for tax credits. Tax credits are non-taxable payments issued by the UK government. The Child Tax Credit may be available to those who are financially responsible for children or young adults living in their home. Those who are employed, but still earn a low income may qualify for the Working Tax Credit. It is often possible to receive both types of credit. A short questionnaire to help you determine eligibility is available on the HM Revenue & Customs website. Don’t let this money go unclaimed if you qualify.
Many people do not understand how tax credits work or know that they may be eligible. In many cases, it is well worth hiring an accountancy firm to help prepare your taxes in order to ensure you are taking advantage of every opportunity to keep more money in your bank account instead of paying it to the government.
Knowing you have the possibility to receive a credit back certainly makes spending the time sorting out the taxes less painful. What could you do with a bit of extra money? Splurging on a vacation, a down payment on a car or paying off debt are commonly at the top of wish lists.
What You Need:
If you plan on applying, the deadline to submit all tax credit applications is the end of July. You will need to provide several pieces of information when applying.
- Your National Insurance Number
- Documentation of expenses if you paid a registered provider to care for your children.
- Documentation of any benefits received, such as payments from Jobseeker’s or Career’s allowance contributions
- Documentation of all income received, including that from side jobs and investments, such as rent, pensions and interest on savings accounts
- Detailed documentation of your income during the last tax year (from April 6th of the past year to April 5th of the current year). Those who were employed can easily access this information on either their P60 certificate or their final paystub for the tax year. Those who were self-employed during the tax year will need to prepare a detailed list of all income on their own.
How to File
- Gather up all of the above information and then call the Tax Credits helpline. You will then be sent the tax credits application packet.
- Fill out the tax credits application. If you need help with your taxes, contact an accountancy firm.
- Submit the application to the tax credits office and wait to hear if you qualify.
It is important for business owners to have a basic knowledge of tax credits. Many people who qualify don’t apply. Employees who have more money available to them through tax credits are often happier and more productive workers. Learn the basics about the tax credits application from an accountancy professional and encourage employees to research their eligibility.