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7 April, 2021 Open access

HMRC provides further information in relation to £500 one-off payment to working households in receipt of tax credits

Update confirms that there is no need to apply for the payment which should be received into bank accounts by 23 April 2021

HMRC has provided further information in relation to the £500 one-off payment being made to working households in receipt of tax credits.

In the Spring 2021 Budget, the Chancellor announced the Coronavirus Support Scheme which provides for a one-off payment of £500 to working households in receipt of tax credits on 2 March 2021, and follows the withdrawal of the temporary increase to working tax credit which was introduced at the start of the Covid-19 pandemic and which ended on 5 April 2021.

In an email to stakeholders, HMRC has clarified that -

NB - HMRC highlights that the text messages will not include a link and claimants should be vigilant about scams which mimic HMRC messages.

In addition, HMRC confirms that - 

'Customers will not need to pay Income Tax or National Insurance on the amount of this one-off payment and it does not need to be declared in a Self-Assessment return. Customers also do not need to declare the payment for tax credit claims or renewals. It will not affect any other benefits, such as housing benefit or universal credit, that they may receive.'

For more information, see One-off £500 payment from revenuebenefits.org.uk