CPAG in Scotland Tax Credits Project: Factsheet 16Tax Credits for Disabled WorkersIntroduction IntroductionThis leaflet looks at tax credits for workers who are disabled, one of the main groups of people who can qualify for working tax credit. There are two types of tax credit; working tax credit and child tax credit. Working tax credit has a special qualifying route for disabled workers and additional amounts for disabled adults. Tax credits are administered by Her Majesty’s Revenue and Customs (referred to as the Revenue in this leaflet). Do you qualify for working tax credit?You must be aged 16 or over, pass the residence and immigration tests, and fall into one of the four groups of people who can qualify for working tax credit:
If you are responsible for a child, you can claim child tax credit whether or not you are in work. Disability conditions: Boxes A and BTo qualify as a disabled worker, you must meet a qualifying benefit condition as listed in Box A and have a disability that puts you at a disadvantage at getting a job, as listed in Box B. There is no requirement to undergo a medical examination when you claim working tax credit, but you may be asked to provide supporting evidence.
Working 16 hoursTo qualify as a disabled worker, you must normally work at least 16 hours per week. This can be as an employee or self-employed. Paid time off for medical appointments is included in your total weekly hours of work. How to claimClaims must be made in writing on form TC600 and then renewed by way of an annual declaration after the end of each tax year in April. You must claim either as a single person or as part of a couple. If you are part of a couple, one of you must work enough hours to qualify for working tax credit, you cannot add together hours to meet the 16 (or 30) hour rule. The claim form asks you to put an X in a box if you meet the disability conditions. How much do you getThe amount of tax credit you get depends on your circumstances and your income. See CPAG in Scotland’s leaflet Tax credits – the basics, for more information on how tax credits are calculated. Disability elementIf you meet the qualifying conditions as a disabled worker, you qualify for a disability element to be added to your working tax credit. The disability element is £2,570 per year (20010-11 rate), although the amount you get may be less than this, depending on your income. For couples, the person with the disability must work 16 hours or more to qualify for the disability element. If both members of a couple meet the disability conditions and are both working at least 16 hours per week, two disability elements are paid. Severe disability elementYou qualify for a severe disability element if you are entitled to disability living allowance (DLA) at the highest rate for care or attendance allowance at the higher rate. The severe disability element is £1,095 per year (2010-11 rate). For couples, the severe disability element is paid if either member is entitled – not just the worker. If both members of a couple are entitled, two severe disability elements are paid.
Backdating and qualifying benefitsYour tax credit claim can be backdated for up to 93 days without any requirement to show why you did not claim earlier. The Revenue says it will automatically check for backdated entitlement, but it is advisable to request backdating in writing. A new working tax credit claim can be backdated for more than 93 days where you would only have been entitled earlier if you were awarded a qualifying benefit such as disability living allowance (DLA). You must claim tax credits within 93 days of the award of the qualifying benefit. Your tax credit claim can be backdated to the date the qualifying benefit was awarded from, or, if later, from the date you were first entitled to tax credits (eg when you started work). An increase in tax credit due to the disability/severe disability elements can be backdated for up to three months in any case, or for more than three months as long as you notify the Revenue within three months of a qualifying benefit being awarded. You should tell the Revenue immediately of changes to your DLA award to avoid being overpaid or underpaid tax credits.
What happens if you are off work due to sickness?You can still get working tax credit if you are off work, or stop work, due to sickness, as long as you were working enough hours to qualify for WTC (eg, 16 hours or more per week as a disabled worker) immediately before being ill. This applies for up to 28 weeks in which you receive statutory sick pay, employment and support allowance, short-term lower-rate incapacity benefit or are entitled to income support or national insurance credits on the grounds of incapacity or limited capability for work. After 28 weeks if you are still off sick, your working tax credit entitlement stops. You should notify the Revenue if you are off work due to sickness, to avoid overpayments if this lasts more than 28 weeks. You can also ask for your tax credit award to be increased if your income has reduced, but remember to notify the Revenue when you return to work and your income goes up again. What happens if you go into hospital?If you go into hospital, working tax credit continues for up to 28 weeks as long as you are receiving a benefit or credit for sickness as described above. The disability and severe disability elements continue to be paid during a period in hospital, even when payment of DLA care is suspended. Stopping workYou must notify the Revenue if you stop normally working 16 hours per week. Remember that if you stop work due to sickness you may still qualify for working tax credit for 28 weeks and if you stop work due to maternity you may still qualify for 39 weeks. Otherwise if you stop work, you are entitled to a four-week run-on of working tax credit. If you get another job or return to work within 8 weeks, you can re-qualify as a disabled worker again under Box A;5, as long as you still meet one of the criteria in Box B. If you were getting incapacity benefit, employment and support allowance or severe disablement allowance before starting work and you stop working within two years, you can usually return to your former benefit at the same level. Contacting the RevenueYou should contact the Tax Credit Helpline on 0845 300 3900 if you have any questions about your claim, and keep them informed of any changes that may affect your award. If you have difficulties using the telephone, the Revenue has enquiry centres open weekdays during office hours, although you may be given an appointment for longer enquiries. You can find your local enquiry centre, and check if it is wheelchair accessible, on the Revenue website (www.hmrc.gov.uk/enq/index.htm).
The Revenue has a duty under the Disability Discrimination Act to promote equality of opportunity for disabled people, and sets out its commitments in the Disability Equality Scheme (available on the Revenue website). If you feel that the Revenue is failing in this respect, you can contact: Diversity and Equality Team Further information and adviceCPAG in Scotland Tax Credits Project summary webpages Child
Poverty Action Group in Scotland Email: advice@cpagscotland.org.uk Website: www.cpag.org.uk/scotland/taxcredits/
CPAG in Scotland’s advice line is only for advisers. If you are having problems with your own tax credit or benefit claim and are in need of advice you should contact your citizens advice bureau or other local welfare rights service. HM Revenue and Customs (formerly the Inland Revenue)
© Child Poverty Action Group, April 2010 Child Poverty Action Group is a charity registered in England and Wales (registration number 294841) and in Scotland (registration number SC039339). Company limited by guarantee registered in England (registration number 1993854). Registered office: 94 White Lion Street, London N1 9PF CPAG in Scotland’s Tax Credit Project is funded by the Scottish Government. This factsheet was last updated April 2010 |
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