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Budget March 2010 - benefits and tax credits

  • Published: Wednesday, 24 March 2010

Tax credits are to be increased for families with children aged one and two from April 2012. It is also being made easier for people aged over 60 to claim Working Tax Credit.

Budget 22 June 2010

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Find out what the Budget does and what takes place on the day

The March 2010 Budget was the final Budget for the last Labour government. George Osborne, Chancellor of the new coalition government, delivered his first Budget on Tuesday 22 June 2010. The new Budget may affect some of the information below. To read about the June Budget, click the orange button.

Benefit rates for 2010-11

The new benefit and tax credit rates from April 2010 were announced in the Pre-Budget Report in December 2009.

Increases in inflation-linked benefits and tax credits from next month were announced, representing real increases in support.

The basic State Pension and Pension Credit for single pensioners will increase by above-inflation levels.

Working Tax Credit

The childcare element of the Working Tax Credit will be simplified and made more responsive.

This will allow parents with short-term childcare needs to receive payments when they need them, such as in the school holidays, rather than getting a smaller, average payment over the course of the year as is currently the case.

People on the Employment and Support Allowance will be moved through the 'disadvantage test' of the disability element in Working Tax Credit. This will mean that they automatically qualify for this element.

People aged 60 and over who work 16 hours a week will now qualify for Working Tax Credit. At the moment they need to work for 30 hours a week to qualify.

Child Tax Credit

From April 2012, the child element of the Child Tax Credit will be raised by £4 a week for each child aged one and two.

Winter Fuel Payment

Additional payments alongside the standard Winter Fuel Payment will continue to be made in 2010-11. These are worth £100 to households with someone aged over 80, or £50 if someone is over the female State Pension Age.

Housing Benefit

From October 2011, the most expensive rents in the country will be excluded when calculating Housing Benefit rates for tenants in private rented accommodation.

This will help make sure that Housing Benefit does not pay for tenants to live in properties that would be unaffordable to other low-income households.

Special guardianship payments

From April 2011, special guardianship payments will not be counted as income when calculating entitlement to Housing Benefit and Council Tax Benefit.

This will make sure that guardians who receive payments from local authorities do not see their Housing Benefit or Council Tax Benefit reduced because of these payments.

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