How non-UK benefits affect tax credits

If you or your partner get social security benefits from another country, they usually count towards your income for tax credits. 'Family’ benefits, for example benefits paid because you have a family, don't count as income for Child Tax Credit, but they may affect the amount you can get.

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Non-UK benefits that count towards your income

The amount of tax credits you get depends on how much money you've got coming in - your income. Some benefits you get from other countries count as part of your income. These include benefits paid in another country because of:

  • bereavement
  • old-age
  • sickness or incapacity
  • unemployment
  • caring responsibilities

For example, the non-UK equivalents of the following UK benefits will count towards your income:

  • Bereavement Allowance
  • Incapacity Benefit at the short-term higher or long-term rate
  • Jobseeker’s Allowance, both income-based and contribution-based
  • contribution-based Employment and Support Allowance
  • Carer’s Allowance

It doesn't make any difference which country is paying the benefits.

Examples of benefits paid by the Republic of Ireland that count towards your income are:

  • Jobseeker’s Benefit or Jobseeker’s Assistance
  • Carer’s Allowance or Carer’s benefit

If you get any of these types of benefits and you're not sure whether they count as income, contact the Tax Credit Helpline.

Contact details for the Tax Credit Helpline

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Non-UK benefits that don't count towards your income

Some benefit payments made by other countries don't count towards your income when your tax credits are worked out. These include benefits that are the equivalent of the following UK benefits:

  • Income Support
  • income-related Employment and Support Allowance
  • Attendance Allowance
  • Child Benefit
  • Child Tax Credit
  • Disability Living Allowance
  • Guardian’s Allowance
  • Maternity Allowance
  • Personal Independence Payment
  • Working Tax Credit
  • Housing Benefit
  • Council Tax Benefit

Examples of benefits paid by Republic of Ireland that don't count towards your income:

  • Family Income Supplement (FIS)
  • Child Benefit
  • Deserted Wife's Allowance
  • Lone Parent Allowance
  • Supplementary Welfare Allowance

If you think you get any of these types of benefits and you're not sure whether they count as income, contact the Tax Credit Helpline.

Contact details for the Tax Credit Helpline

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You get 'family' benefits

If you get a 'family' benefit from a European Economic Area (EEA) country or Switzerland it won't usually count towards your income for tax credits. Some examples of family benefits from the Republic of Ireland include the following:

  • Child Benefit
  • Family Income Supplement
  • Lone Parent Allowance

If you're not sure if your benefit is a family benefit, contact the Tax Credit Helpline.

Which are the EEA countries?

The countries in the EEA along with the UK are Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.

Contact details for the Tax Credit Helpline

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How EEA or Swiss family benefits affect tax credits payments

If you get family benefits from an EEA country or from Switzerland, and you're claiming Child Tax Credit, your payments will depend on your personal circumstances. Family benefits do not affect Working Tax Credit - it's Child Tax Credit they affect.

The Tax Credit Office will decide whether the UK or the other country is responsible for paying your family benefits under the European rules. They may need to contact you to get more information to help make this decision. The sorts of things that will be taken into account include:

  • the country or countries where you and your partner (if you have one) work and pay social security contributions
  • the country where you live
  • the country where your family lives
  • the type of benefits you get either from the UK or from the EEA country

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Your EEA or Swiss family benefits are more than Child Tax Credit

The UK could be responsible for paying you your family benefits, for example because you work in the UK and pay UK National Insurance contributions. But you may get family benefits from another EEA country or Switzerland as well. If these are more than the Child Tax Credit and any Child Benefit you're entitled to from the UK, you'd normally get:

  • the Child Tax Credit and Child Benefit that you are entitled to
  • a top-up from the other country as well

This is to make sure that, overall, you don't lose out on getting the right money for you and your family.

The top-up is worked out by taking away the UK benefits from what the other country pays you. You'll get the difference between the two from the other country. So your total benefit will be what you're entitled to from the UK, plus any extra amount you're entitled to from the other country.

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Your tax credits are more than your EEA or Swiss family benefits

The amount of tax credits you get depends on which country is responsible for paying your family benefits.

If another EEA country or Switzerland is responsible for your family benefits, they might be lower than the UK family benefits you're entitled to. If so, you'll normally get a top up of Child Tax Credit and any Child Benefit you're entitled to.

The amount of the top-up is the difference between:

  • the family benefit payments the other country makes
  • the total amount of Child Tax Credit and Child Benefit you're entitled to

If the UK is responsible for paying your family benefits, these could be more than the family benefits you get from the other country. If so, the other country usually stops their payments.

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Any changes to your non-UK benefits

Let the Tax Credit Office know if any of the benefits you get from another EEA country or Switzerland go up, go down or stop. Tell them too if you start getting a new benefit.

It's important to tell the Tax Credit Office about any changes straight away so you go on getting the right payments.

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More useful links

How your tax credits entitlement is worked out

Get details of Child Benefit rates

Your family isn't in the UK - get help with your tax credits claim

Other help you might qualify for if you get tax credits

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