Tax breaks or tax-free childcare? You must notify HMRC if your circumstances have changed after Covid-19

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    A little over 1.4 million people receive tax credits. If you are no longer eligible for tax credits, other sources of government assistance are available and you may be able to apply for a universal credit instead. For the full breakdown, see our Universal Credit Guide. You may also be able to apply for a pension credit if you and your partner are the statutory retirement age or older.

    Don’t worry if you are no longer eligible for WTC. You are still entitled to the child tax deduction if you have already received it and have not yet claimed the universal allowance.

    Get tax-free childcare? You will need to show proof that you are making at least £ 142 / week

    Likewise, in pre-Covid times, you had to earn an average of 142 / week to claim up to £ 2,000 / year per child for childcare costs. During the crisis, the rules were temporarily relaxed to allow those whose incomes fell below £ 142 / week as a result of Covid-19 to continue receiving the benefit.

    But now the next time you confirm your tax-free childcare entitlement, which you have to do every three months, you’ll need to prove that you are earning at least 142 / week. For a full breakdown of how this benefit works, see our guide to tax-free childcare.

    If the repeal of the temporary regulations means that you are no longer entitled to tax-free childcare, you may instead be able to claim back up to 85% of your childcare costs through the universal loan.

    The Universal Loan increase of £ 20 / week ends

    Last year, in response to the coronavirus pandemic, the government increased the standard universal credit allowance by £ 20 / week – from £ 317.82 / week to £ 409.89 / week for a single person aged 25 and over.

    This survey ends on October 6th. You may be eligible for additional payments or other assistance, so it’s worth checking out our guide to Universal Coronavirus Credits and Perks to learn more.



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