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Wednesday, 3 October 2023

Changes to your working hours and tax credits

You must work a minimum number of hours a week to get Working Tax Credit. If your usual working hours change, tell the Tax Credit Office straight away. You could start getting Working Tax Credit, or your current payments might change.

Number of usual working hours

You don't have children

If you're not responsible for children, you need to work the following hours to get Working Tax Credit:

  • if you are aged 25 or over, you need to do paid work of at least 30 hours a week
  • if you have a disability and are 16 or over, you need to do paid work of at least 16 hours a week
  • if you are aged 60 or over, you need to do paid work of at least 16 hours a week

You have children

If you're responsible for children you need to be aged at least 16, and work the following hours to get Working Tax Credit:

  • if you're single, you need to do paid work of at least 16 hours a week
  • if you're in a couple, your joint paid working hours need to be at least 24 a week, with one of you working at least 16 hours a week

So if you're in a couple and only one of you is working, that person will need to work at least 24 hours a week.

If your joint working hours are less than 24 a week, you can still get Working Tax Credit if one of the following applies:

  • one of you is aged 60 or over and working at least 16 hours a week
  • one of you is disabled and working at least 16 hours a week
  • one of you works at least 16 hours a week and the other person is entitled to Carer's Allowance - even if they don't get any payments because they receive other benefits instead
  • one of you works at least 16 hours a week, and the other is 'incapacitated', an in-patient in hospital, or in prison (serving a custodial sentence, or remanded in custody awaiting trial or sentence)

If you're now working fewer hours

If your hours have gone down temporarily, you can normally carry on getting your usual tax credits payments for four weeks. This is from the date your hours dropped. This can happen as long as you expect your hours to go back to normal after four weeks.

If your hours have gone down until further notice or for good, you may carry on getting the same tax credits payments for four weeks. This is from the date your hours go down. This can happen as long as you continue to meet the other qualifying conditions for Working Tax Credit.

After the four weeks is up, your tax credits may:

  • stop if you no longer qualify
  • go down if you still qualify for some payments

What you need to do

You must tell the Tax Credit Office within one month if your hours of paid work fall below the minimum for your circumstances. To find out the minimum working hours, see 'Number of usual working hours' at the top of this page.

You also need to get in touch within one month if either of the following happens:

  • you or your partner were working at least 30 hours a week, and your hours have dropped to less than 30 hours a week
  • you're in a couple with children, and your joint working hours drop to less than 30 a week

You can report any of these changes by calling the Tax Credit Helpline.

If you are no longer working

If you stop work altogether, you will only be paid Working Tax Credit for a further four weeks from the date of the change.

What you need to do

Let the Tax Credit Office know within one month if you:

  • stop working altogether either as an employee or self-employed person
  • are no longer working and you expect it to be four weeks or more before you start another job

You must report these changes within one month, or you could be paid too much money (an overpayment) which you may have to pay back. You may also be charged a penalty of up to £300.

You can report the changes by calling the Tax Credit Helpline.

If you're now working more hours

You may get more money if your hours have gone up. Any increase in your payments can only be backdated by up to one month so make sure you report the change straightaway.

If your income has gone up it may not affect your current tax credits. But it will affect how much you should be paid for next year.

What you need to do

Tell the Tax Credit Office straightaway if you:

  • are responsible for children, and were working less than 16 hours a week, but are now working 16 or more hours a week
  • were working less than 30 hours a week and are now working 30 or more hours a week
  • are part of a couple with children and your joint working hours are now 30 or more a week - with one of you working at least 16 hours a week
  • are part of a couple with children, and your joint working hours are now 24 or more a week - with one of you working at least 16 hours a week

It's best to tell the Tax Credit Office about these changes within a month. This is because if the change is likely to increase your tax credits payments, the increase can only be backdated by up to one month.

Also tell the Tax Credit Office straightaway if your increased hours mean your income is likely to go up.

You can contact the Tax Credit Office by calling the Tax Credit Helpline.

If you start working

You might not be working, but already getting tax credits, perhaps because your partner's working, or you've got children. If you do start work - either employment or self-employment - tell the Tax Credit Office within one month. You can do this by calling the Tax Credit Helpline. It doesn't matter how many hours you're working, you still need to report the change.

If you've started working for an employer, tell the helpline your employer's full pay office address and PAYE tax reference when you get in touch. The PAYE reference should be on your latest payslip, or ask your employer if you're not sure.

Your earnings might not make a difference to the tax credits you're currently getting. But they will affect what you're entitled to for the next year.

Provided by HM Revenue and Customs

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