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Does receiving Carer's Allowance count towards hours for Working Tax Credits?

Personal Finance & Money Asked by Avrohom Yisroel on October 3, 2021

I know this is the sort of of question that ought to be easily available on the gov.uk web site, but having searched for ages, and found conflicting information on external sites I’m looking for some help.

My wife and I receive Working Tax Credits. She also receives Carer’s Allowance. As far as I understand, in order to qualify for WTC, we need to work 24 hours per week between us. I have been told that as she receives CA, that counts for 8 hours, meaning that I would only need to work 16 hours to qualify.

Anyone able to confirm or deny this? A link to gov.uk would be the best, as that is (supposedly) the authoritative source.

Thanks

One Answer

I think it's not so much Carer's Allowance counts towards the hours required for Working Tax Credit; instead, it is more that if one person gets Carer's Allowance, it reduces the hours that the other person needs to work1.

The page Working Tax Credit on Gov.UK lists the basic requirements for claiming Working Tax Credit2:

Hours you work

You must work a certain number of hours a week to qualify.

Circumstance                      Hours a week  
------------------------------    -----------------
Aged 25 to 59                     At least 30 hours  
Aged 60 or over                   At least 16 hours  
Disabled                          At least 16 hours  
Single with 1 or more children    At least 16 hours
Couple with 1 or more children    Usually, at least 24 hours between you  
                                  (with 1 of you working at least 16 hours)

A child is someone who is under 16 (or under 20 if they’re in approved education or training).

Since you mention "we need to work 24 hours per week between us", I assume the last category applies. In that case, the following (from the same page) will apply (emphasis mine):

Exceptions for couples with at least one child

You can claim if you work less than 24 hours a week between you and one of the following applies:

  • you work at least 16 hours a week and you’re disabled or aged 60 or above
  • you work at least 16 hours a week and your partner is incapacitated (getting certain benefits because of disability or ill health), is entitled to Carer’s Allowance, or is in hospital or prison

So, if your wife is receiving Carer's Allowance, you should only need to work for 16 hours a week to qualify for Working Tax Credit2. However, the page Carer's Allowance: Effect on other benefits on Gov.UK includes (emphasis mine):

Effect on your benefits

When you claim Carer’s Allowance your other benefits may be reduced, but your total benefit payments will usually either go up or stay the same.

Carer’s Allowance does not count towards the benefit cap.

If you get Working Tax Credit or Child Tax Credit, you must contact HM Revenue and Customs (HMRC) to tell them about your Carer’s Allowance claim.

So it looks like you need to explicitly tell them about the Carer's Allowance.


1 This may seem slightly pedantic, but I was at first confused by "as she receives CA, that counts for 8 hours" and the fact that a person has to care for someone at least 35 hours per week to claim Carer's Allowance.

2 The first page referenced above, dealing with Working Tax Credits includes:

New Working Tax Credit claims

Working Tax Credit has been replaced by Universal Credit for most people.

You can only make a new claim for Working Tax Credit if you get the severe disability premium or got it in the past month and are still eligible for it.

If you cannot make a new claim for Working Tax Credit, you may be able to apply for:

In your case ("My wife and I receive Working Tax Credits") this should not be an issue (providing, as I read it, there is no break in eligibility from one month to the next), but anyone not already claiming WTC would need to apply for Universal Credit instead.

Correct answer by TripeHound on October 3, 2021

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