Working Tax Credit is ending in the United Kingdom from 2025: the Government of the United Kingdom is going to completely stop Working Tax Credit. This change is very important for millions of people who were receiving financial assistance under this credit till now. If you are also a beneficiary of this scheme, then this article will prove to be very useful for you. In this, we will know in detail what is the reason behind this change, what will be its effect on your payment and how you can successfully transition to Universal Credit.
What is Working Tax Credit?
Working Tax Credit was a government scheme that was started to provide financial assistance to low-income working people. If you work some minimum hours and your income is below a certain limit, then you used to get this credit.Its purpose was to ensure that even after working, if your income is not sufficient, then the government should help you so that your basic needs can be met.
Why is it ending now?
The UK government has been implementing a new scheme called ‘Universal Credit’ for the past few years, which aims to integrate many different benefits into a single system.
The following benefits have been combined into Universal Credit:
- Working Tax Credit
- Child Tax Credit
- Income Support
- Income-based Jobseeker Allowance
- Income-related ESA (Employment and Support Allowance)
- Housing Benefit
- Now the government wants all existing working tax credit claimants to transfer to Universal Credit before 2025.
What will happen after 2025?
If you do not apply for Universal Credit before 2025, your working tax credit payments will stop. The government is individually informing all claimants through letters about when and how they have to make the transition. This is being called Managed Migration This simply means you have to apply for Universal Credit yourself, or your old benefit could be stopped.
Are you eligible for Tax Credit?
If you’re receiving Working Tax Credit, it’s almost certain you’ll be eligible for Universal Credit. But there are some eligibility criteria:
- You must be at least 18 years old (16+ is valid in some cases)
- You must be living in the UK and not earning a high income
- You must not have savings of more than £16,000
- You must be working, or looking for work
- You can check eligibility on the GOV.UK website or use the Universal Credit eligibility checker.
What will be the difference to payments?
Universal Credit is paid slightly differently to Working Tax Credit:
- Payments are made once a month
- The amount is determined by your income, number of children, housing situation and other needs
- Payments may be delayed for the first five weeks (advance payments are available)
- So financial planning is important when changing plans.
How to apply?
If you’ve already received a Migration Letter, you’ll need to apply for Universal Credit online on the government’s website.
You’ll need the following documents to apply:
- Identity card (passport, driving licence)
- Bank account details
- Income information
- Rent or housing contract information
- After applying, you may need to meet with a work coach before your payments begin.
Important tips and precautions
- Don’t miss your Migration Letter: it tells you when you have to transfer to Universal Credit.
- Apply on time: Missing the deadline could result in your payment being stopped.
- Take advance payment: If you are facing financial difficulties in the beginning, there is an option to take advance payment.
- Provide accurate information: If you provide incorrect or incomplete information, your application may be rejected.
- Get help from Citizens Advice: If you have problems applying, you can get help from a local help centre.
Conclusion:
2025 will be the year Working Tax Credit ends, and this is a big change for all those who have relied on this scheme till now. But there is no need to panic – Universal Credit is a comprehensive and centralised scheme that is ready to continue helping you. All you need to do is apply on time and provide the correct information.
FAQs
Q1. Why is the Working Tax Credit ending in 2025?
A. The UK government is phasing out Working Tax Credit to simplify the welfare system by merging multiple benefits into Universal Credit.
Q2. Will my Working Tax Credit stop automatically in 2025?
A. Yes, but before that, you will receive a “Migration Notice” from DWP informing you of the deadline to apply for Universal Credit.
Q3. What should I do if I receive a Migration Notice?
A. You must apply for Universal Credit before the deadline mentioned in the notice to avoid interruption in your payments.
Q4. What happens if I don’t apply for Universal Credit by the deadline?
A. Your Working Tax Credit will stop, and you may lose access to financial support until you submit a new claim for Universal Credit.
Q5. Am I eligible for Universal Credit if I currently receive Working Tax Credit?
A. Most likely, yes. However, you must meet Universal Credit eligibility criteria, such as income limits and residency status.
