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Working Tax Credit

Volume 488: debated on Friday 27 February 2009

To ask the Chancellor of the Exchequer what assessment he has made of the effect of shortened working hours as a result of the recession on claimants of working tax credits. (259218)

Tax credits are a flexible, responsive system of financial support that adjusts to people's circumstances. Shortened working hours that have the effect of reducing a household's income may lead to a higher tax credits award, provided that the household continues to meet the normal eligibility conditions for tax credits.

In December 2008, 412,000 households were benefiting from an increased tax credits award because of a fall in income compared to their previous year's income. To receive any additional support, households need only notify HMRC of their changed circumstances.