Tax credits


Working tax credit
  2015/16 2014/15
Basic element £1,960 £1,940
Couple and lone parent element £2,010 £1,990
30 hour element1 £810 £800
Disabled worker element £2,970 £2,935
Severe disability element £1,275 £1,255
Childcare element of working tax credit
Maximum eligible cost for one child £175 p.w. £175 p.w.
Maximum eligible cost for two or more children £300 p.w. £300 p.w.
Percentage of eligible costs covered 70% 70%
Child tax credit
Child tax credit family element £545 £545
Child element £2,780 £2,750
Income thresholds and withdrawal rate
Income threshold £6,420 £6,420
Withdrawal rate 41% 41%
First threshold for those entitled to child tax credit only £16,105 £16,010
Income rise disregard £5,000 £5,000
Income fall disregard £2,500 £2,500

From 2015/16

From April 2016 the taper rate in tax credits will increase from 41% to 48% of gross income. Once claimants earn above the income threshold in tax credits, their award will be withdrawn at a rate of 48p for every extra pound earned.

Limit child element in tax credits and Universal Credit

The Child Element of tax credits and Universal Credit will no longer be awarded for third and subsequent children born after 6 April 2017. Multiple births and other exceptional circumstances will be protected from the two children limit.

Income rise disregard in tax credits

From April 2016 the amount by which a claimant's income can increase in-year compared to the previous year's income before their award is adjusted is to be reduced from £5,000 to £2,500.