New Tax Credits payment rates and thresholds for 2m…

New Tax Credits payment rates and thresholds for 2m people from April

HM Revenue and Customs (HMRC) recently confirmed that Tax Credit payments will be changing for all benefit claimants in the new financial year which runs from April 6, 2023 to April 5, 2024. The annual rates and threshold increase will come into effect from April for everyone receiving Working Tax Credits and Child Tax Credits payments.

Depending on your household circumstances, you may be eligible for one or both payments, or you may also qualify for one of two types of disability element add-ons. However, it’s worth noting these are for existing claimants already receiving the legacy benefit and any new claims should be made through the Department for Work and Pensions (DWP) for Universal Credit.

The latest figures from HMRC show that in 2020 to 2021, there were approximately two million families claiming Child Tax Credit and/or Working Tax Credit with some 3.7m children in Tax Credit claiming families.

Working Tax Credit is paid to people who are in work and on a low income – it does not matter whether you are an employee or self-employed, and you do not need to have children to get the payment.

Child Tax Credit is paid to people who have children and is paid in addition to Child Benefit and the Scottish Child Payment - you do not have to be working to receive it.

Here are the details of the proposed new payment thresholds and rates for the 2023/24 financial year.

Working Tax Credit rates for 2023/24 (yearly amount shown)

Working Tax Credit income threshold

2023/24 rate: £7,455
2022/23 rate: £6,770

Basic element

2023/24 rate: £2,280
2022/23rate: £2,070

Couples and lone parent element

2023/24 rate: £2,340
2022/23 rate: £2,125

30-hour element

2023/24 rate: £950
2022/23 rate: £860

Disabled worker element

2023/24 rate: £3,685
2022/23 rate: £3,345

Severe disability element

2023/24 rate: £1,595
2022/23 rate: £1,445

Child Tax Credit rates for 2023/24 (yearly amount shown)

Child Tax Credit income threshold

2023/24 rate: £18,725
2022/23 rate: £17,005

Family element

2023/24 rate: £545 (no change)
2022/23 rate: £545

Child and qualifying young person element

2023/24 rate: £3,235
2022/23 rate: £2,935

Child disability element

2023/24 rate: £3,905
2022/23 rate: £3,545

Severely disabled rate of the child disability element

2023/24 rate: £1,575
2022/23 rate: £1,430

You can read the full list of proposed payment rate and threshold changes on the GOV.UK website here.

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