TaxAdministrationDirect payment of Working Tax Credit launched

Direct payment of Working Tax Credit launched

Businesses to save up to £115m as HMRC phases out employer payment of Working Tax Credits

HM Revenue & Customs is phasing out the payment of Working Tax Credits by
employers from today, in a move that will save them between £110m and £115m a
year.

The changes to the way the government pays Working Tax Credits mean all new
claimants will have their Working Tax Credit paid direct into their bank
account, and existing claimants will be switched to direct payments over the
next five months.

The changes were made following consultation with employers’ representatives
and are part of the government’s wider agenda to reduce red tape for businesses.

Paymaster General Dawn Primarolo said: ‘The Government is committed to
reducing regulatory burdens wherever possible, and following consultation with
employers, we are from today starting to replace payment of Working Tax Credit
through employers with direct payment to claimants. This will save businesses up
to £115m every year from next April.

‘No-one will lose out. These changes will be made automatically and will not
affect anyone’s entitlement to Working Tax Credit. The switch to direct payment
will mean recipients no longer have to involve their employer in their claim,
improving confidentiality for claimants.’

Employers with questions about the process can call the Employer’s Helpline
on 08457 143 143, which is contactable on weekdays from 8.30am to 8.00pm, and
weekends from 8.00am to 5.00pm.

Employees with any questions can call the Tax Credits Helpline on 0845 300
3900, which is available seven days a week from 8.00am to 8.00pm (excluding
Christmas, Boxing Day, New Year’s Day and Easter Sunday).

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