Who needs to renew tax credits?

If you submitted a claim for tax credits during the last tax year (between 6th April, 2015 and 5th April, 2016) you will need to renew, or review your tax credit entitlement.

This applies irrespective of whether you received tax credits for the whole year, for part of the year, or if you had your claim for tax credits refused.

If you made a claim for tax credits last tax year then you will be sent a tax credit renewal pack; if you made multiple claims you will be sent one tax credit renewal pack for each.

This pack with either be:

  • an A5 brown envelope containing an Annual Review notice (TC603R)

  • an A4 white envelope containing an Annual declaration (TC603D or TC603D2) and an Annual Review notice (TC603R)

If you receive the white envelope containing the Annual declaration you need to renew your tax credit entitlement as soon as possible.

If you receive the brown envelope you simply need to review the details HMRC have included. If they are correct then you do not need to do anything else.

If your circumstances have changed or if there are any errors on the form you need to notify HMRC as this will affect your entitlement.

You need to review your Annual review notice even if you do not intend to claim tax credits this tax year.

When will you get your renewal pack?

HMRC start to send out tax credit renewal packs in April and the last ones are sent out at the end of June.

The white envelopes containing the Annual declaration forms are usually sent out first followed by the brown envelopes containing the Annual review notices.

If you have not received a tax credit renewal pack by the 27th June and think you should have, you must contact the Tax Credit Helpline to request that the forms be sent to you.

When do you need to renew your tax credits?

Once you receive your tax credit renewal pack you have until 31st July to renew your entitlement, or report any changes that affect your circumstances.

You can do this by completing your Annual declaration form and sending it back to the tax credit office, by calling the Tax Credit Helpline (0345 300 3900) or by renewing online.

If you choose to call you be aware that the Tax Credit Helpline gets very busy towards the end of July and getting through to speak to an advisor can become difficult. You should either submit your tax credit renewal by post, or call as soon as you receive your pack.

Some renewal packs will specify a different deadline so you must check to make sure you get yours in on time.

If you need any help completing your tax credit renewal you can take your pack to your nearest Citizens Advice Bureau and they will be able to assist.

How long does it take to process renewals?

Once you have submitted your tax credit renewal, or informed the Tax Credit Office of any changes to your circumstances you should receive a reply within 8 weeks.

This will be in the form of an award notice which will confirm whether you have been overpaid or underpaid tax credits during the past tax year.

You will also receive an award notice showing your payments for the coming year, providing your circumstances remain the same.

You should check the details on both forms carefully and contact the Tax Credit Office if you notice any errors.

What happens if you do not renew?

If you have been sent an Annual declaration form (white envelope) and do not renew your tax credits by 31st July your payments will stop.

If this happens you only have 30 days to contact the Tax Credit Office with the information they have asked for or you will need to submit a new tax credit claim and start the process again. You may also be asked to repay anything you have received since 6th April this year.

You will also be asked to pay back any overpayments you have received in the last tax year. If you have not kept HMRC up to date with your circumstances this could work out to be a large amount.

What happens if you do not report any changes?

If your circumstances have changed over the past year, or if they change over the coming tax year, you must inform HMRC so your tax credit payments can be amended.

Once you notify them of a change, HMRC will calculate whether you are receiving too much, or too little in the way of tax credits and adjust your payments accordingly.

If you do not inform HMRC of any changes that affect your entitlement and get paid too much tax credit you will be asked to return any overpayments you have received to them on or after renewal.

These changes include if your living circumstances, your job or your working hours change; see the Gov.uk website for a full list.

What if you have been overpaid tax credits?

You will be asked to repay the money. This can happen if you fail to renew on time, make a mistake on your form or fail to inform HMRC of a change in your circumstances.

You can do this by making a direct payment, or by having your ongoing payments reduced until you have cleared what you owe. If you have stopped receiving tax credits, you will have to make a payment. Your options are explained on the Gov.uk website.

You can appeal if you think their calculations are wrong and you need to do this within 30 days. There is more information about how to appeal on the Gov.uk website.

Where can you get help with your tax credits?

If you need help you can contact HRMC to discuss your tax credits.

If you would like personalised one to one advice on your tax credits you can search for a chartered tax adviser that specialises in them on the Chartered Institute for Taxation website.