You need to renew if you receive an Annual Declaration form (TC603D or TC603D2) with an Annual Review notice (TC603R).
You don’t need to renew if you only receive an Annual Review notice (TC603R), as your claim will be renewed automatically. However you still need to tell the Tax Credit Office straightaway if:
- you have had any changes in circumstances
- your income is different to what’s shown in the Annual Review notice
- there are mistakes or details missing from the notice
If you’ve been sent an Annual Declaration (TC603D or TC603D2) and don’t renew, the following will happen:
- your payments will stop
- you will have to pay back any overpayment from the previous tax year
- you will also have to pay back any payments you’ve received from the start of the new tax year
- you’ll get a statement from the Tax Credit Office about your tax credits payments
- you will usually have to make a new tax credits claim if you don’t provide the information within 30 days
The HMRC calculator will help you understand whether you are entitled to tax credits and how much you could claim http://taxcredits.hmrc.gov.uk/Qualify/DIQHousehold.aspx
I know that many small business owners claim tax credits because in the early years of the business their income is low.
So don’t forget to renew by 31st July.