YOUR Tax Credits Renewal
Everything YOU Need to Know About YOUR Tax Credits Renewal
The deadline for renewing your tax credits is looming. The year has flown by and you have until the 31st July to get everything in order. If you’re claiming working tax credit and/or child tax credit you’ve come to the right place.
The renewal process is important for two different reasons:
- It gives HMRC the information to finalise tax credit awards for the past year (2017/2018).
- It renews the claim for the current year (2018/2019).
If you claimed tax credits in the previous year (2017/2018) you should have already received a renewal package and you will most likely need to respond to HMRC as a result. Even if you have no intention of renewing your claim for the current year, you must still make sure HMRC has all the correct information on your 2017/2018 income in order to correctly process your previous year’s awards.
The Process of Renewing
The renewal pack that you received should contain a statement of your 2017/2018 tax credits and a few extra guidance notes. In some cases, you may not actually have to respond. This is referred to as an ‘auto-renewal’ case and all you have to do is ensure that all the information is correct and up to date. If it is, your claim will automatically renew, unless you contact HMRC to state otherwise. It should be very easy to distinguish from the pack which category you fall into.
For those of you who are employed, HMRC utilises income from the Real Time Information PAYE system to produce the tax credits renewal statement. Though it is important to note that is it is still essential to double check the figures, occasionally the payroll information supplied is not always correct.
If you don’t have all the final income figures needed for 2017/2018 – for example, if you are self-employed and do not yet have your final accounts in order – you can make use of estimates to ensure the renewal is complete in time for the deadline.
Now, this all might seem quite overwhelming, especially if you’re relatively new to undertaking this process. But, renewing your tax credits can be done easily through many different ways. To do it online, just see the following link – Manage your tax credits. You can also renew digitally by downloading and using the HMRC app which is available for free.
However, before using the online service, ensure that you have already registered with the Government Gateway. This can take up to a month.
If your old-fashioned or love talking to people tax credits can also be renewed by sending back the paper form included in the renewal pack or over the telephone. The latter may entail some annoying waiting music though, so be prepared!
Something which is very convenient is that in a joint claim, one partner can renew on behalf of both of you.
For any further details just follow the following link – How to renew tax credits – for details.
What Happens if You Miss the Deadline?
So, if you miss the 31st July 2018 deadline, your tax credits payments for the 2018/2019 year will not be renewed and will inevitably stop. Not to worry too much though, as they won’t stop immediately. HMRC will send a notice, letting you know that your payment will come to an end. Thankfully, if you then renew within 30 days of this notice, your 2018/2019 award should then be restored. Phew!
Even if you still manage to miss this, you still have a chance to restore your 2018/2019 award so long as you have ‘good cause’ for missing the deadline and renew by 31st January 2019.
At The Buxton Partnership, we would highly suggest ensuring that you do meet the 31st July deadline in the first place – better safe than sorry!
If you do fail to renew successfully, you will have to make an entirely new claim, which can only be backdated by one month and you will also have to repay the provisional repayment made to you since April 2018. Furthermore, there is also the risk of a penalty for not complying with the renewal requirements.
Additionally, if you renewed using estimated figures, as mentioned earlier, you should provide the final figures by the final renewal deadline which is the 31st January 2019.
If you need assistance, please call The Buxton Partnership on 01606 871729 and one of the team will be happy to help you.