The process for claiming tax credits are operating a little different this year, claimants would usually be asked to complete a ‘Tax Credit Annual Declaration Form’ with actual or estimated figures by 31 July. However due to Covid-19 HM Revenue & Customs (HMRC) have issued clients with a ‘Tax Credit Annual Review’ form with the aim of auto-renewing as many claims as possible.
The Annual Review asks claimants to check all information held by HMRC are correct and complete and are usually set out as follows:
- STEP A – personal details including hours worked, number of qualifying children etc
- STEP B – details held of household income for the period ending 5 April 2020
- STEP C – include two steps to confirm income for 2019-20 is correct and a band of expected income for 2020-21
If any of the information detailed within each step is incorrect then HMRC urge claimants to get in touch to update them. Claimants must get in touch by 31 July 2020 if any updates are required or HMRC will auto-renew on the basis the information included on the ‘Annual Review’ is complete & correct.
If HMRC find that payments have been based on incorrect or incomplete information, then claimants may be required to pay back any tax credits overpaid and could also be faced with a penalty. The only contact claimants would need to make with HMRC is if the information held is incorrect or circumstances have changed.
Further to this HMRC have issued an apology following omissions made on some of the renewal notices initially sent out to claimants. HMRC have subsequently sent a follow-up letter with the correct income details used in its tax credits calculations, and said human error was to blame for the original fault.
More detail can be found on the error at the following BBC News article:
Claimants may have also received a text urging them to get in touch if their income has changed and to confirm the estimates made for the following year are correct.
If you are usually in receipt of tax credits but have not received the ‘Annual Review’ then HMRC have advised for claimants to get in touch to request a copy. This can be done over the phone, over webchat or online (if you have a personal tax account set up).
TAX CREDIT HELPLINE: 0345 300 3900
ONLINE LINK: www.gov.uk/taxcredits
If you would like assistance with your tax credits ‘Annual Review’ form please contact us.
For anyone who is already a client at LHP, where we also prepare your Self-assessment tax return you should shortly receive a text message from us regarding bringing in your tax credits forms if you require further assistance.