Child Tax Relief Credits

The deputy prime minister, Nick Clegg, has recently announced that as many as 2.1 million people could loose their child tax relief credits worth hundreds of pounds a year.

The reason behind the move is that the government needs to make significant cuts to the treasury finances and they believe it is not unreasonable to ask the middle class to reduce their child tax relief to help pay for this.

child tax reliefCurrently parents can claim a child tax credit if they earn less than £58,000 a year or £60,000 if the child is under the age of one. Under the governments new proposal this income limit would reduce to £30,000 or possibly even as low as £25,000, based on both parents income. Lowering this limit would mean that 2.1 million families would no longer be able to claim the allowance.

Under the scheme a family with three children with a household income of £25,000 is eligible for £92 a week.

A family with three children and an income of £50,000 will only receive £10 a week.

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