Working Tax Credit (WTC)
Who Can Claim Working Tax Credit?
There are four routes to qualifying:
- You have a child living with you - you and/or partner work over
16 hours a week.
- You have a disability - that puts you at a disadvantage getting
work and work over 16 hours a week.
- You are aged over 25 - without children or a disability and
work 30 hours or more a week.
- You are aged over 50, have been out of work for 6 months or
more and work 16 hours or more a week.
The basic element of WTC
WTC is made up of several elements. The basic element is
included in every WTC award. If you don’t qualify for a basic
element you don’t qualify for WTC. There are four conditions to the
- you are working at the date of claim - or you are about to
start work within 7 days, AND
- the job is likely to continue for at least 4 weeks, AND
- the work is done for payment, or in expectation of payment.
- or your partner are responsible for a child or qualifying young
- are at a disadvantage getting work because of disability (see
page 137) OR
- meet the conditions for the 50+ element
- OR, you are aged 25 or more and work for 30 hours in all other
Hours of work and remunerative work
These are the hours normally worked. It does not include
customary or paid holiday or any unpaid time for meals or
The work has to be remunerative. Some work is not counted, such
as voluntary work, caring work for which payment is disregarded,
participating in a JSA Intensive Activity Period, on a training
scheme (for which an allowance is paid), participating in an
employment zone programme, or receiving a sports award with no
other payment expected.
Treated as being in work
You count as being in qualifying work (remunerative and for
enough hours) during absences from work:
- when you receive Maternity Allowance or Statutory Maternity
- when you receive Statutory Paternity Pay or Statutory Adoption
- when you receive Statutory Sick Pay or would have but for the
fact that you are self-employed, OR
- during breaks in a recognisable annual cycle of seasonal or
term time working, OR
- during gaps of up to 7 days between jobs
Maximum Working Tax Credit
Your maximum WTC is made up of up to eight elements:
- Basic element - included in every WTC claim that meets the
criteria. See the conditions above.
- Second adult element - if you are claiming jointly with a
partner of the opposite sex, (unless one of you gets the 50+
element and neither of you work for over 30 hours a week).
- Lone parent element - if you are a lone parent of a qualifying
- 30 hours plus element – if you (or a partner) work 30 hours or
more a week. If you and a partner have a dependent child/young
person, you can add your hours together to make up the thirty.
- A Severe disability element – an extra amount per adult getting
DLA Care (Higher Rate) or AA (Higher Rate)
- Are aged at least 50, AND
- started work in the last 3 months, AND
- work at least 16 hours a week, AND
- for at least 6 months prior to starting work were receiving (or
a partner was claiming for you as their adult dependant) either
Income Support, JSA, Incapacity Benefit, SDA or Retirement Pension
with Pension Credit, OR
- were receiving these benefits for less than 6 months, but
immediately prior to receiving them you were receiving Carers
Allowance, Bereavement Allowance or Widowed Parent’s Allowance
There are two rates of the 50+ element depending on whether you
work 16 to 29 hours or 30 hours +.
- Disabled worker element – if you or your partner are a
“disabled worker” (see below). If you both qualify you can have two
disabled worker elements
- Childcare element – 70% of actual qualifying child care costs,
up to maximum costs of £175 for one child and £300 for two or more
children (see below for more details).
The childcare element
This is part of Working Tax Credit, as it is only available for
working parents. However, it is not paid along with the rest of WTC
in the wage packet, but directly by the Inland Revenue to the
parent with main care of the children along with the Child Tax
Who can claim for childcare costs?
To be able to include the childcare element in the maximum WTC,
you must be EITHER:
- a lone parent engaged in remunerative work, OR
- both partners are in remunerative work, OR
- one partner is in remunerative work and the other is
The concession that allows you to be treated as in remunerative
work for claiming WTC while on maternity pay or during non-working
parts of a seasonal/term-time work cycle, does not apply to the
“Incapacitated” means a partner is receiving either: Incapacity
Benefit (short-term higher or long term), Severe Disablement
Allowance, Attendance Allowance, Disability Living Allowance or a
Housing Benefit/Council Tax Benefit which includes a disability
What costs can you claim for?
Costs can only be claimed in respect of “qualifying children”
which means up until:
- The end of the week in which occurs the 1st September
immediately after the child’s 15th birthday
- The end of the week in which occurs the 1st September
immediately after the child’s 16th birthday, if the child is
counted as disabled (i.e. meets the conditions for the disabled
child element of CTC)
The childcare must be provided EITHER:
- by persons required to register under section 10A of the
Children Act (e.g. childminders), OR
- in schools or establishments which are exempt from
- by a school on school premises or by a local authority (e.g. an
out-of-hours or holiday playscheme) – but only for children from
age 8 to the 1st Monday in September after their 12th birthday,
- by a childcare provider approved by an accredited organisation
within the Tax Credit (New Category of Child Care Provider)
- by a childcare provider approved in accordance by the National
Assembly, Scottish Parliament or Department of Health.
The maximum amount of WTC childcare element is 70% of the
eligible costs, up to maximum costs of £175 for one child and £300
for two or more children. The amount is based on the average weekly
costs over the year. You must notify the Inland Revenue if
childcare costs rise or fall by more than £10 a week. The childcare
element will then be recalculated.
Will I get Maximum WTC?
That depends on the income test, which is applied to both WTC
Last Updated: 29.07.2008 at 17:36