Tax credits are great ways to topple your low income and they have proved to be a great help in the same time. If it’s approved tax credits are paid on a weekly or monthly basis for a year, however when it comes to renewal, you need to be aware of a few things. In this chapter we would like to discuss some know-how regarding the tax credit renewal packs.
What’s important to know is, once they are approved tax credits need to be renewed and the process needs to be started well on time.
When someone applies for a tax credit they are due to expire at the end of a fiscal year which is April. Then, renewal packs are sent out for all those who have been previously approved and who are paid tax credits. The renewal packs are being sent out between April and June each year. It’s important to note that unless you are informing the Credit office of any changes to your income, then your last year’s income will be taken as a base. It’s extremely important to let the tax office know of any changes to your income, positive or negative likewise, to ensure all calculations are met and correct.
Each renewal has a deadline, therefore it’s easy to miss. When someone surpasses the deadline and fails to renew their credits then the payment will automatically stop. What’s worse is, that you may even be asked to start with the repayment should you miss out this deadline. Renewal can be completed but if you miss out on the second deadline then a new claim has to be made which will take a considerable amount of time to reassess. The two major deadlines of renewal are 31st July and 31st September.
If your last year’s income is too high to make a claim for tax credit but have since dropped, you can still apply for a tax credit because even if it’s not accepted, you can then reassess the claim by using the current income.
It’s extremely important to note that this whole system is bound to change this year as the UK Tax Credit will be part of Universal Credit, starting from April 2017 therefore many things are to change and there is no exact information as to how the changes will affect the current credit system.
Universal Credit is a credit system which is already in use in the United Kingdom and currently works in parallel with the governmental tax credit system. The transition time is due to be long but most importantly, those who are already members of the current tax credit system would still get their payments this year, given they have applied before the transition period starts.
You can get more information and you can also fill out the application form online and send it in for evaluation. The evaluation period for tax credits is around 3 weeks. Application forms can also be sent in in a postal way, but their evaluation may last somewhat longer this way.