Disability benefits - how do they affect tax credits payments?

If you are claiming disability benefits for yourself or your child, you may qualify for extra tax credits on top of the other benefits you are getting.

What are the benefits that can help you qualify for extra tax credits?

To get extra tax credits one of the following needs to apply:

You need to be getting - or have recently been getting - 'qualifying' sickness or disability benefits. You will also have to meet other conditions too to get extra tax credits, such as having a specific disability.
Either you or your partner gets the Highest Rate Care Component of Disability Living Allowance or the Higher Rate of Attendance Allowance.
You get Disability Living Allowance for a child you're responsible for.

You have a child with a disability - can you get extra tax credits?

Examples of qualifying sickness or disability benefits that you might be getting, or have been getting recently, include the following:

a benefit you are currently receiving, such as Disability Living Allowance or Attendance Allowance
a benefit that was paid in the last six months, like Council Tax Benefit with a Disability Premium or Higher Pensioner Premium for you
you have been 'training for work' for at least one day in the last eight weeks and in the eight weeks before you started training for work you must have been getting one of a number of benefits, for example Severe Disablement Allowance

Find out more about other qualifying benefits if you have a disability (PDF 116K)

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How much will you get?

In this tax year (6 April 2009 to 5 April 2010), on top of your basic tax credits you could get:

£2,530 a year, that is around £48 a week, if you are disabled
£3,605 a year, that is around £69 a week, if you are severely disabled
£2,670 a year, that is around £51 a week, if your child is disabled
£3,745 a year, that is around £72 a week, if your child is severely disabled

The amount of tax credits you are paid depends on other income you have coming in. The higher your income, the lower your tax credits payments.

To find out more about how much you might get, call the Tax Credit Helpline on Tel 0845 300 3900 (or textphone 0845 300 3909) or use the detailed online questionnaire.

Find out how much you can get using an online tax credits questionnaire

How your tax credits entitlement is worked out

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How your disability benefits are taken into account

When you make a claim for tax credits your income is worked out by adding together things like wages, interest on savings and some benefits.

Disability benefits that don't count towards your income

These benefits don't count towards your income when your tax credits are worked out:

Disability Living Allowance
Attendance Allowance
Incapacity Benefit (at the short term lower rate paid for the first 28 weeks)
income-related Employment and Support Allowance
Severe Disablement Allowance
Industrial Injuries Disablement Benefit

Disability benefits that do count towards your income

These benefits do count towards your income when your tax credits are worked out:

Incapacity Benefit paid at short term higher or long term rates - 29 weeks or more
contribution-based Employment and Support Allowance
Carer's Allowance

More about which state benefits you need to report when making a tax credits claim

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Benefits that might be reduced if you start getting tax credits

Disability benefits like Disability Living Allowance, Attendance Allowance and Incapacity Benefit won't be reduced when you start getting tax credits.

Other benefits you or your partner might be getting, such as Carer's Allowance, should not be affected by your tax credits.

However, some benefits will be reduced if your income goes up and you will need to report any increase in income you have when you start getting tax credits.

Council Tax Benefit and Housing Benefit

Council Tax Benefit and Housing Benefit will probably be reduced if your income increases. You should let the following people know as soon as you start getting tax credits:

If you're in England - your local council.
If you're in Northern Ireland and are a tenant you need to let the Northern Ireland Housing Executive know. But if you're an owner-occupier you need to let the Land and Property Services know instead.

But make sure whoever pays your Council Tax Benefit or Housing Benefit knows that you, or someone in your family, are disabled. You may be entitled to more Council Tax or Housing Benefit.

Find your local council on Directgov

Find Northern Ireland contact details on the Land and Property Services website

Get Northern Ireland Housing Executive contact details on their website

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Contact the Tax Credit Office

If you need more help you can call the Tax Credit Helpline which is open from 8.00 am to 8.00 pm every day except Christmas Day, Boxing Day and New Year's Day. The numbers you can ring are:

tel 0845 300 3900
textphone 0845 300 3909 - if you are deaf or have a hearing or speech impairment

If you're calling from overseas you can also contact the Tax Credit Office on Tel + 44 289 053 8192.

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