Tax credits: How much can you earn and still get tax credits?

People who work a certain number of hours a week and have an income below a certain amount, could be entitled to £1,960 a year in Working Tax Credit. This number is called the basic element of Working Tax Credit and is the part every claimant receives – based on how much you earn. There are several other elements claimants could be entitled to depending on individual circumstances.

Who is eligible for Working Tax Credit?

It can be difficult to decipher who is eligible for Working Tax Credits and who isn’t.

But, if any of the following categories apply to you, you could be eligible for tax credit.

If you are single and don’t have children, you have to work at least 30 hours a week and be 25 and older.


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If you’re in a couple without children, you must also be over 25 and work at least 30 hours a week.

If you are disabled and are employed, or if you have children, you may be eligible for tax credit if you are over the age of 16 and work at least 16 hours a week.

You must be a UK resident to claim the help, except if you are a citizen of a country in a European Economic Area (EEA) working in the UK, if you are a Crown Servant who has been posted overseas or you are a citizen of an EEA country living abroad, but receiving a UK State Pension and/or contribution-bases Jobseeker’s Allowance (JSA).

If you are living with a partner, married or in a civil partnership, you must claim tax benefits jointly and cannot opt to claim individually.


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What’s the threshold, and how much will you get?

Income thresholds exist to limit the amount of tax credits higher earners can receive.

The amount of Working Tax Credit you see will start going down when you earn more than £6,420 a year.

For every £1 of income you earn over this threshold, the amount of tax credit will reduce by 41p each time.

So, if someone receives a salary of £8,000 a year, you would be earning £1,580 over the threshold.

For each pound over the limit, tax credit will be reduced by 41p, meaning the total tax credit would be reduced by £647.80 in one year.

Working Tax Credit is comprised of several different elements, which translate to payments.

Claimants could be eligible for just one element or for a few different ones, depending on family circumstances.


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Everyone who qualifies for tax credit is sure to receive the basic element.

This is worth up to £1,960 during 2019/20, depending on individual income – this amount did not change from 2018/19.

Extra elements can be claimed depending on circumstances, and all elements are added together.

HMRC reduces the amount you are entitled to the higher your income gets.

How are Working Tax Credit and child tax credit related?

Claimants are able to claim Working Tax Credit and child tax credit at the same time.

If you qualify for tax credit and care for one or more children, you will most likely be able to claim child tax credit too.

These extra credits include:

  • The childcare element of Working Tax Credit if paying for childcare
  • The single parents’ elements of Working Tax Credit if you are raising a child alone

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