What Will Changes To Working Tax Credits Mean For You (2019)?
In late 2018, it was announced by the UK Government that plans were in place to start transferring people from the existing benefits or tax credits onto Universal Credit from July 2019.
In a process known as managed migration, it was announced by the Secretary of State has announced that this process will begin as a pilot scheme for approximately 10,000 people initially.
What is Universal Credit?
Universal Credit is a payment to help with your living costs. You may be eligible if you’re on a low income or out of work.
Universal Credit will replace the following benefits:
- Child Tax Credit
- Housing Benefit
- Income Support
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Working Tax Credit
If you currently receive any of these benefits, you cannot claim Universal Credit at the same time.
Universal Credit is being introduced in stages across the UK. You do not need to do anything until you hear from the Department for Work and Pensions (DWP) about moving to Universal Credit, unless you have a change in circumstances.
This change has not been greeted with universal joy. For more on why this may be, please check out this BBC article titled – ‘What is universal credit – and what’s the problem?‘
What does this mean for my income?
The government stated that by 2018 – 2019 eight out of ten households will actually be better off thanks to the introduction of the national living wage and the increase in personal tax allowance to £12,500. There will also be an extension to childcare subsidies.
What this means for each individual family is unclear but there is no need to believe your income will reduce dramatically.
What should I do next?
If you are not currently receiving tax credits and you believe you might be eligible in full or in part it would be a good idea to follow the advice on the Gov.uk website.
If you are currently claiming tax credits you should be sent a renewal pack. Usually, your credits will automatically renew but it is extremely important that you read the information enclosed very carefully because if you fail to advise the Tax Credit Office of changes to your income you might find yourself having to pay the money back if you have been overpaid.
Changes you will need to inform the tax office about are detailed here.
If you are worried about your short term financial situation and are struggling to make ends meet, getting a loan may be a suitable option?
Even if you have a bad credit history our lenders can help as they specialise in poor credit loans. We offer some of the best loan rates available and all you need to do is fill in a quick and simple online form, and you’ll then find out all the loans you qualify for.