T36 - Applications for 2004/05

By when do you have to notify the Taxman about any changes in circumstances to continue receiving tax credits? Is it safe to keep quiet?

Keeping quiet. If you were already receiving tax credits this should have continued after April 6, 2004 because the Taxman is making provisional payments based on your last known circumstances. These payments are made automatically by his computer system, but the catch is that if he overpays you, you’ll have to pay it back later.

Change of circumstances. Your tax credit claim for last year would have been based on your circumstances for 2002/03. In theory, now that the 2003/04 tax year is over, you should have to finalise that year’s claim and submit a renewal application to get tax credits for 2004/05. However, the Taxman has said that he’ll write to existing claimants between April and July with details of what they need to do. What does this mean?

Tip 1. The Taxman will be sending out two different packs of forms and notes to tax credit claimants. If you receive only the so-called family element of the child tax credit: £545 per year for a child over one year old (£10.48 per week) you will get an “automatic review” pack, and you don’t have to send anything back (unless your income and circumstances have changed significantly). If you receive more than just the family element you will receive a “reply required review” pack. It’s best to complete and file the latter by September 30, 2004 or you could lose out.

Tip 2. An automatic renewal means less work for the Taxman. However, check the tax credit award notices he sends you, particularly the net family income figure (for you and your partner) for April 5, 2004. In the meantime start getting together all the information you will need to work out your income for 2003/04.

Tip 3. If there are significant changes to your tax credit circumstances in 2004/05 (such as the arrival of a new baby or you start to use childcare), notify the Taxman as soon as possible by ringing the Tax Credits helpline on 0845 300 3900. A late notification in 2004/05 still means that increases will only be paid from a maximum of three months before the date you inform the Taxman of the change.

We take great pride in our service, and would be delighted to invite you for a free 1 hour, no obligation meeting at our comfortable offices. Simply call us  on 020 8346 0391 to arrange a mutually convenient time.

This web-site was last updated on 13/06/2008

Copyright © 2003-2008 Mac Kotecha & Company. All rights Reserved. The information on this site is for general guidance only. It is essential to take professional advice on specific issues about their impact on any individual or entity. No liability can be accepted for any errors or omission or for any person acting or refraining from acting on the information provided on this site.