Working Tax Credits
We explain if you can claim Working Tax Credits - designed to top up your earnings if you're on a low working income - when living with a mental health condition.
What are Working Tax Credits?
Working Tax Credits (WTC) are a benefit to help when working but on a low income.
Working Tax Credits can help if your job does not pay enough money to cover all your basic living costs.
If you have a mental health condition and meet the Working Tax Credits criteria, you might be able to make a new claim.
What counts as low income?
If your job does not cover your basic living costs, you may be on a low income.
Basic living costs can include:
- Rent payments.
- Household bills (electricity, gas, water).
- Food costs.
- Childcare costs.
There is no set limit for what counts as a low income. The Department of Work and Pensions (DWP) decide on a case-by-case basis.
What counts as work?
You are classed as someone who works if you:
- Work for someone else as a worker or employee.
- Work for yourself and are registered as self-employed with HMRC.
- Are an employee but also do self-employed work.
Can I claim Working Tax Credits?
You can only make a new claim for Working Tax Credits if you already get Child Tax Credits. Working Tax Credits are being phased out and replaced by Universal Credit (UC), so you will need to check your eligibility before applying.
You may be able to make a new claim for Working Tax Credits if:
- You already receive Child Tax Credits
- You meet the minimum number of hours worked per week:
|Minimum hours you need to work
|30 per week
|16 per week
|16 per week
|Single with one or more children
|16 per week
|Couple with one or more children
|24 per week (with one of you working at least 16 hours per week)
- You cannot claim Universal Credit because you or your partner work in Great Britain or Northern Ireland but do not live there.
- You are prevented from claiming Universal Credit for other reasons given by the DWP.
Exceptions if you are a couple with at least one child and you receive Child Tax Credits
If you are a couple and work less than 24 hours per week between you, you can claim Working Tax Credits if:
- You work at least 16 hours per week and are disabled or aged 60+.
- You work at least 16 hours per week, and your partner is:
- Receiving Incapacity Benefit due to ill health.
- Entitled to Carer’s Allowance.
- In hospital or prison.
Case study: Katya and Jacob's example
Katya and Jacob are in a civil partnership. They have a 12-year-old daughter called Poppy and receive Child Tax Credits.
Jacob has Antisocial Personality Disorder (ASPD). He receives treatment, including talking therapy but sometimes finds it difficult to manage his emotions.
Jacob’s condition makes it hard for him to work.
Katya works part-time to help care for Jacob and Poppy. She works 21 hours a week as a school receptionist.
Together, Jacob and Katya work less than the 24-hour per week minimum a couple needs to claim Working Tax Credits.
However, Jacob receives Incapacity Benefit due to his mental health condition.
Under these circumstances, Katya can apply for Working Tax Credits to top up her wages.
I have never received Working Tax Credits before. Can I still apply?
You will need to apply for Universal Credit (UC) if you have never claimed Working Tax Credits.
The Department for Work and Pensions (DWP) are gradually moving people to Universal Credit. This process is called ‘managed migration’.
I am working 16 hours a week but have reached the State Pension age. Can I still get Working Tax Credits?
When you reach the state pension age, the benefit rules change, and you might be able to apply for Pension Credit instead.
I am already receiving Working Tax Credits. Can I still get them?
You may still receive Working Tax Credits if you meet the following conditions:
- You are aged 25 or over and work at least 30 hours per week.
- You are on a low income.
- You are not subject to immigration control.
You may also be able to continue receiving Working Tax Credits if you meet at least one of the following conditions:
- Between 16 – 24 years old and you or your partner are working for 16 or more hours per week.
- A single parent responsible for a child (aged 15 or under).
- A couple, one or both of you are responsible for a child, and one of you works at least 16 hours a week, and you work at least 24 hours between you.
- A couple, one or both of you are responsible for a child, and one of you works at least 16 hours per week because the other person is in hospital, in prison, or entitled to carer’s allowance.
- You are incapacitated and working 16 hours or more a week. You usually count as being incapacitated if you get certain benefits. The list is long, and we have not detailed all the incapacity benefits here, but the most common incapacity benefits are:
- Severe Disablement Allowance (being replaced with ESA).
- Disability Living Allowance (being replaced with PIP).
- Personal Independence Payment (PIP), or
- Contribution-based Employment and Support Allowance (ESA) – but you must have been able to claim for at least 28 weeks.
- If you have been assessed as meeting the criteria for having limited capacity for work due to illness or disability.
If you have limited capacity for work due to illness or disability, you should also qualify for the disability element of Working Tax Credits if you work an average of 16 hours a week.
Disability Element of Working Tax Credits
Working Tax Credits have a disability element. You may qualify for this element if you meet all the following conditions:
- You work 16+ hours per week.
- You have a disability that makes it harder for you to find a job than someone who does not have a disability. The DWP might ask you to prove that your disability makes it harder for you to find work.
- Physical disabilities that make day-to-day activities difficult to carry out. Examples include:
- Visual impairment (Blind or reduced sight)
- Hearing impairment (deaf or reduced hearing)
- Mobility issues (wheelchair user, crutches, unable to perform day-to-day tasks without assistance)
- Mental Health conditions that make day-to-day activities difficult to carry out. Examples can include:
- Borderline Personality Disorder (BDP)
- Anxiety Disorders
3. You receive or have been receiving a qualifying sickness or disability benefit.
What are the qualifying benefit conditions?
- Income-related Employment and Support Allowance (ESA).
- Contribution-based Employment and Support Allowance (ESA).
- Housing Benefit which includes a Disability Premium or Higher Pensioner Premium because of your disability.
- Incapacity Benefit at the lower or higher rate.
- Income Support.
- Income-based Jobseeker’s Allowance (JSA) that includes a Disability Premium or Higher Pensioner Premium.
- National Insurance Credits.
- Occupational Sick Pay.
- Severe Disablement Allowance.
- Statutory Sick Pay (SSP).
- War Pension with a mobility supplement.
- Disability Living Allowance.
- Attendance Allowance.
- Personal Independence Payment (PIP).
- Armed Forces Independence Payment.
Case study: Jason's example
Jason has Generalised Anxiety Disorder. His condition affects his day-to-day life, and he often cannot sleep or concentrate.
Jason’s muscles ache, and he feels ‘on edge’ as he worries a lot about different things all the time.
He works 20 hours a week for the local cinema, but his mental health condition makes it difficult to work more hours.
Jason receives Working Tax Credits to help top up his wages.
He also receives Personal Independence Payment (PIP) from the DWP to help with his condition.
Jason’s mental health condition made it harder for him to find a job than his friends, who do not have a general anxiety disorder.
Jason has been looking for another job. However, his mental health condition puts him at a disadvantage compared to other people.
Jason finds it harder to concentrate and work more than 20 hours a week. He soon discovers there are fewer jobs available that he can do.
Under these circumstances, Jason is eligible to receive the disability element of Working Tax Credits.
Benefit test for Working Tax Credits
You may be asked to take a qualifying benefit test by the DWP. You will pass this test if you are receiving a disability benefit such as:
- Disability Living Allowance (DLA),
- Personal Independence Payment (PIP),
- Armed Forces Independence Payment (AFIP), or
- Attendance Allowance (AA).
You also pass this test if at any time in the last 26 weeks you were getting Employment and Support Allowance (ESA) or National Insurance credits due to limited capacity for work.
There are other ways to receive the disability element of Working Tax Credits without satisfying the qualifying benefit test.
However, these can be very complex. If you are returning to work and have a disability that will likely last at least six months, you should seek advice from a Work and Benefits adviser.
My mental health condition makes it harder for me to work or find work.
You may find it more difficult to find work if you have a mental illness.
- Be receiving treatment or be under the supervision of an approved mental health professional (AMHP).
- Get confused or forgetful, or
- Have problems making friends or relationships.
You may be able to claim more money if you are employed. For example, this would happen if your earnings go down because of reduced hours, or you have made a Statutory Sick Pay (SSP) or Employment and Support Allowance (ESA) claim.
Can I get Working Tax Credits when I’m not working
There are times you can receive Working Tax Credits when you are not working.
- If you are on maternity, paternity, or adoption leave.
- If you are off work sick.
- If you have lost your job.
If you have been in paid work and have fulfilled all the Working Tax Credits qualifying criteria, you will still get Working Tax Credits when you are not working.
If you are employed by an organisation and your mental health condition forces you to take time off sick, you also should check whether your employer has a company sick pay scheme (CSP).
Many organisations offer enhanced sick pay above statutory sick pay (SSP) levels, so it is always worth checking.
My situation has changed. Do I need to tell anybody?
You must tell Her Majesty’s Revenue and Customs (HMRC) immediately about any change to your income or working hours.
This is called ‘change in circumstance’. HMRC may decide to reduce or increase the amount of Working Tax Credits you receive.
If you do not tell HMRC about any changes in your circumstances, the DWP may decide to reduce or stop your claim.
Always tell HMRC immediately about any change to your income here.
I currently receive Working Tax Credits. Do I have to renew my claim?
HMRC will send out a renewal pack if the DWP decide you are still eligible for Working Tax Credits.
This will happen every year until your circumstances change or the DWP decide to move you over to Universal Credit.
You should receive your renewal pack in early June. You must renew your Working Tax Credits claim by 31st July each year.
If you do not receive a renewal pack by the first week of June, you should immediately contact HMRC or the DWP.
Will my Working Tax Credits stop?
You may stop getting Working Tax Credits if your circumstances change, and this will happen if:
- You claim as a single person, but you become part of a couple,
- You claim as a couple, but you become single, or
- You don’t work enough hours to qualify.
- The DWP decide to move you over to Universal Credit (UC).
How will I know if I can still claim Working Tax Credits?
You can check your eligibility at any time using the information here and on the Government website.
The Department of Work and Pensions (DWP) should also tell you if they want to move you over to Universal Credit (UC). They may refer to this process as ‘managed migration’.
Benefit rules are complex and often change. If you are ever unsure about what is happening, you should contact a Work and Benefits adviser.
- How do I check what I’m entitled to?
- Universal Credit
- Employment and Support Allowance
- Jobseeker’s Allowance
- Income Support
- Incapacity Benefit
- Severe Disablement Allowance
- Statutory Sick Pay
- Working Tax Credits
- Personal Independence Payment
- Housing Benefit
- Support for Mortgage Interest
- Council Tax: Exemptions and Support to pay
- Social Fund
- Next steps