National statistics

Child and Working Tax Credits Finalised Annual Awards 2021 to 2022 Main Commentary

Published 13 July 2023

About this release

These statistics focus on the estimated number of families benefitting from Child Tax Credit (CTC) and/or Working Tax Credit (WTC) in England, Scotland, Wales and Northern Ireland during the tax year ending 2022 (6 April 2021 to 5 April 2022).

This publication presents a breakdown of families by their profile position, type of family and family size.

It also includes statistics on families benefiting from each of the different elements of tax credits and provides information on the income used in calculating awards.

What are tax credits?

Tax credits are a system of financial support for families and can be claimed jointly by couples or single adults. The amount of support is known as a family’s ‘entitlement’.

A family’s entitlement changes with their daily circumstances and is based on the following factors:

• age

• income

• hours worked

• number and age of children

• childcare costs

• disabilities

For further information about who can claim please refer to the benefits page on GOV.UK.

Main headlines

The number of families claiming tax credits has steadily fallen since tax year ending 2011, when changes to the tax credit system were implemented.

In tax year ending 2022, there were an estimated:

• 1,511,000 families claiming tax credits - this is an estimated fall of 506,000 (25%) compared to the previous year (Figure 1)

• 2,875,000 children in tax credit claiming families - this is an estimated fall of 859,000 (23%) compared to the previous year

There have also been several policy changes during this period which have impacted these figures. These are:

• changes to the tax credit system implemented in April 2011
• start of the Universal Credit (UC) rollout in April 2013
• the full rollout of the digital UC service across the country in December 2018
• the closure of new tax credits claims in December 2018
• the temporary WTC uplift from April 2020 to April 2021

Figure 1: Estimated number of families (millions) receiving tax credits, from tax year ending 2009

Changes since previous publication

Impacts of the COVID-19 pandemic

During 2020, as part of a number of measures to support the country through the COVID-19 pandemic, claimants of WTC received an increase of up to £20 each week. This temporary uplift was removed in 2021 to 2022, meaning many claimants moved back from WTC and CTC to CTC only, or positive CTC to nil awards at the start of April 2021.

Section 1: Time series

In general, there has been a downward trend in the number of recipient families for all categories of benefits since tax year ending 2013 (Figure 2).

Between tax year ending 2021 and tax year ending 2022, the estimated number of recipient families fell from:

• 868,000 to 598,000 for in-work, WTC and CTC, a decrease of 31%

• 543,000 to 427,000 for out-of-work, CTC only, a decrease 21%

• 390,000 to 351,000 for in-work, CTC only, a decrease of 10%

• 217,000 to 135,000 for in-work, WTC only, a decrease of 38%

The order of size of recipient categories has remained constant with the largest as ‘in-work WTC and CTC’, followed by ‘out-of-work, CTC only’, with ‘in-work, CTC only’ as third, and then finally ‘in-work WTC only’.

Figure 2: Estimated number of families (millions) receiving tax credits by tax credit type, from tax year ending 2013

Figure 3 shows that estimated annual entitlement remained at similar levels between tax year ending 2013 and tax year ending 2016, at an estimated £28.4 billion. From tax year ending 2017 there has been a gradual decrease in estimated annual entitlement to tax credits to an estimated £10.8 billion in tax year ending 2022.

Between tax year ending 2021 and tax year ending 2022, the estimated annual entitlement to tax credits fell from:

• £8.8 billion to £5.7 billion for in-work, WTC and CTC, a decrease of 35%

• £4.0 billion to £3.2 billion for out-of-work, CTC only, a decrease 20%

• £1.7 billion to £1.5 billion for in-work, CTC only, a decrease of 10%

• £0.7 billion to £0.4 billion for in-work, WTC only, a decrease of 40%

Figure 3: Estimated annual entitlement (billions of £s) by type of tax credits, from tax year ending 2013

Section 2: Summary

Summary of composition of tax credits

The most common type of tax credit received is ‘in-work, WTC and CTC’ for both singles and couples. For sole parents, this is followed by ‘out-of-work, CTC’. However for couple families, the next most common type is ‘in-work, CTC only’. The least common tax credit type is ‘In work, WTC only’ for both singles and couples.

Figure 4: Estimated number of families (thousands) receiving tax credits by tax credit type, split by family type, tax year ending 2022

Table 1: Data for Figure 4, number (thousands) and percentage of families by tax credit type, split by family type, tax year ending 2022

Tax credit type	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
In-work, CTC only	101	29	250	71	351
In-work, WTC and CTC	351	59	247	41	598
In-work, WTC only	81	60	54	40	135
Out-of-work, CTC only	292	68	136	32	427

Children in recipient families

Couples generally make up a higher proportion of larger families, with an estimated 70% of families with 4 or more children composed of couples, compared with an estimated 28% of 1 child families.

The distribution of children includes all children or qualifying young people in families receiving tax credits. This may not be equal to the number of children for whom the family is receiving the child element of CTC due to the policy to provide support for a maximum of 2 children, affecting children born after 6 April 2017 unless they are covered by an exception.

Figure 5: Estimated number of families (thousands) receiving CTC by number of children and family composition, tax year ending 2022

Table 2: Data for Figure 5, estimated (thousands) and percentage of families receiving CTC by number of children, split by family type, tax year ending 2022

Number of children	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
1 child	348	72	135	28	483
2 children	255	52	238	48	493
3 children	99	38	160	62	258
4 or more children	42	30	99	70	141

Entitlement bands

Figure 6 shows estimated total families receiving tax credits by annual entitlement, with the largest proportion of families (an estimated 21%) receiving an annual award between £6,000 to £7,999.

Figure 6: Estimated number of families (thousands) receiving tax credits, by entitlement band, tax year ending 2022

Table 3: Data for Figure 6, number (thousands) and percentage of families receiving tax credits by annual entitlement band, tax year ending 2022

Entitlement band	Families (thousands)	% of families
Under £2,000	144	10
£2,000 to £3,999	301	20
£4,000 to £5,999	191	13
£6,000 to £7,999	320	21
£8,000 to £9,999	219	15
£10,000 to £11,999	140	9
£12,000 to £13,999	89	6
£14,000 to £15,999	45	3
£16,000 and over	63	4

Section 3: Detailed figures

Figure 7 shows estimated average weekly support with childcare costs for claimant families. The costs claimed for range from under £20 to over £150 a week. Lone parents across all cost bands make up the majority for eligible childcare costs.

Figure 7: Estimated number of families (thousands) receiving childcare costs by cost band, split by family type, tax year ending 2022

Table 4: Data for Figure 7, estimated number (thousands) and percentage of of families receiving childcare costs by cost band, split by family type, tax year ending 2022

Cost band	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
Under £20	11	80	3	20	14
£20 to £39.99	14	80	3	20	17
£40 to £59.99	10	78	3	22	13
£60 to £79.99	7	77	2	23	9
£80 to £99.99	5	74	2	26	7
£100 to £119.99	4	73	1	27	5
£120 to £139.99	3	73	1	27	4
£140 to £159.99	3	72	1	28	4
£160 to £179.99	5	77	2	23	7
£180 to £199.99	1	63	0	37	1
£200 to £249.99	2	59	1	41	3
£250 and over	4	55	4	45	8

The amount of tax credits a family receives depends on their level of income. Awards based on an income up to £6,565 (the income threshold for year-ending 5th April 2022) receive their maximum entitlement whereas for incomes above this amount the award is tapered (see the Child and Working Tax Credit Entitlement section for details).

The vast majority (an esitmated 91%) of families receiving tax credits had incomes used to taper awards of under £30,000 (Figure 8). The most common income bracket was £10,000 to £19,999. Broadly speaking, the higher the income used to taper the award, the fewer the numbers of families in receipt. This reflects the targeted approach to financial support that is inbuilt into the tax credits system.

Figure 8: Estimated number of in-work families (thousands) by income used to taper awards

Table 5: Data for Figure 8, estimated number of in-work families (thousands) by income used to taper awards, tax year ending 2022

Income	Families (thousands)	% of families
Up to £6,565	130	12
£6,565 to £9,999	200	18
£10,000 to £19,999	432	40
£20,000 to £29,999	223	21
£30,000 to £39,999	82	8
£40,000 to £50,000	14	1
Over £50,000	2	0

A National Statistics publication

National Statistics are produced to high professional standards as set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.

Designation can be broadly interpreted to mean that the statistics:

• meet identified user needs

• are well explained and readily accessible

• are produced according to sound methods

• are managed impartially and objectively in the public interest

• are produced to the highest standard, ensuring that data confidentiality has been maintained

Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.

For general enquiries about National Statistics, contact the Office for National Statistics enquiries on:

Tel: 0345 601 3034

Overseas: +44 20 3973 4760 or +44 1633 817 521

E-mail: sharedcustomercontactcentre@ons.gov.uk

Fax: 01633 652 747

Post: Customer Contact Centre, Office for National Statistics, Room D265, Government Buildings, Cardiff Road, Newport, South Wales, NP10 8XG.

You can also find National Statistics on GOV.UK.

Contact details

Benefits and credits statistics

Media contact: HMRC Press Office

Statistical contact: J Martin