Universal Credit has been gradually replacing tax credits for several years and claimants of the benefit have been encouraged to understand the changes.
Tax credit was introduced in 2003 for people who work and have a low income but it has been slowly integrated into the umbrella of Universal Credit since 2017.
From that point, no new claimants have been able to register for tax credits. But those already on the system have been able to make repeat claims — until this summer.
The Government is now winding down tax credits completely.
When are tax credits ending?
HM Revenue and Customs warned in July that all claimants need to renew their applications by the end of that month to avoid dropping off the system. This was said to be affecting hundreds of thousands of people.
However, a process began in the spring to transfer all tax credit claimants onto Universal Credit to finalise what the Government has been proposing since 2017.
A statement from HMRC said: “By the end of 2024, tax credits will be replaced by Universal Credit. Customers who receive tax credits will receive a letter from the Department for Work and Pensions telling them when to claim Universal Credit, or from the Department for Communities if they live in Northern Ireland.
“It is important that customers claim by the deadline in the letter to continue receiving financial support as their tax credits will end even if they decide not to claim Universal Credit.”
How to apply to Universal Credit
Universal Credit has been a key policy of the Tory Government since 2010 and unites all other types of benefit under one place.
Most people claiming tax credit might want to consider Universal Credit even if they do not end up claiming the new benefit type.
You will not automatically be moved from tax credit to Universal Credit.
HMRC has said to look out for a letter called a Universal Credit Migration Notice from the Department for Work and Pensions (DWP) explaining what you’ll need to do, and by when.
Claimants can use an independent benefits calculator to find out what can be claimed. Universal Credit also offers access to a work coach.
