ACCA (the Association of Chartered Certified Accountants) is reminding existing and new recipients of tax credits to make their renewals by the deadline of 31 July. This follows ACCA’s recent survey which revealed that only 9% of 2,000 people questioned in the UK said they were fully aware and took advantage of tax breaks.
Ultimately tax credits such as Child Tax and Working Tax are important as they pay people based on their last year’s income. Increases in income in the current year should be communicated to the tax credits office immediately as it will probably mean recipients are being overpaid. The same is for where income decreases, but in this situation recipients will not be clocking up any over-payments which will need repaying. Under-payments can, however, only be backdated by three months.
Chas Roy-Chowdhury, head of taxation at ACCA says: “I know the paperwork involved in completing these forms can look daunting to most recipients of tax credits, but recipients must meet this deadline.â€
Forms can either be completed in person or by phone. If opting for the latter, recipients can do so by calling the tax office on 0845 300 3900 and having their income details to hand as well as their P60 form if they are in employment, or estimated income if they are self-employed. Those using estimates, should also note the second deadline of 31 January 2010 in providing the actual income information.
Roy-Chowdhury adds: “One way or another, people need to act before 31 July, even if this is just to review their current position if they are a higher income claimant. The higher income claimant is one where they receive a ‘nil award’ or just the family element of the child tax credit. People need to check that their circumstances have not changed. Otherwise, the renewal will happen automatically without the need to renew. Any increase in income in the current year should be communicated to the tax credits office immediately as it will probably mean recipients are being overpaid.â€
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