The deadline for renewing tax credits – working tax credit and child tax credit – is just a few days away.
People have until July 31 to renew the benefits with the HMRC, and ICAEW Chartered Accountants Manchester – which represents accountancy firms in the region – has produced some advice for claimants.
ICAEW Manchester has 5,300 members – of which 1,700 are from Stockport.
Jane Moore, ICAEW Manchester’s technical manager, said: “Tax credits are vital to many households across the country and it is imperative that people renew before the July 31 deadline.
“With less than one week to go, it’s important that you renew your credits to avoid them being stopped for 2016/17.
“There is also the risk of a penalty for failing to comply with the renewal requirements. To prevent this from happening, we’d urge you to renew your credits now.”
The tax credits renewal process does two things; it gives HMRC the information to finalise tax credit awards for last year, and it renews the claim for the current year – 2016/17.
Anyone who claimed tax credits in 2015/16 should have been sent a renewal pack and most people will need to respond to HMRC.
Tax credits can be renewed online, over the telephone or by sending back the paper form included in the renewal pack.
Jane Moore adds: “HMRC call waiting times may increase dramatically during the busy period leading up to the deadline, therefore you may want to consider renewing online to avoid the stress and anxiety of trying to get through on the phone.”
“If you are employed, HMRC will have taken figures from the PAYE system for 2015/16 and put them on your renewal statement. But it is still important to check those figures and tell HMRC if they are wrong.”
“If you are self-employed, you may not yet have your final accounts for 2015/16 but you should still make your renewal by 31 July – you can do that using estimated figures and tell HMRC when you have the final ones.”
ICAEW Manchester also advises that those renewing, whether online or over the phone, should have key documents relating toincome such as payslips or business accounts, as well as childcare costs incurred, to hand, and the renewal pack itself.
Records should be kept for at least three years.