If you’re wondering how to manage your tax credit in 2025, the first thing to know is that the Tax Credit scheme is coming to an end. The UK Government has permanently closed the scheme for new applications and is gradually replacing it with Universal Credit.
This article will help you understand what Tax Credits were, what’s changed, and what to do if you’re still receiving them.
Paying your taxes via different payment methods may not be acceptable to HMRC. Get instant help from professional accountants and tax advisors to know how to manage your tax credit.
What Were Tax Credits?
Tax Credits were government payments to help people with low income. There were two types:
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Working Tax Credit (WTC) – for people in paid work on a low income.
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Child Tax Credit (CTC) – for people responsible for children.
These payments helped with everyday costs and were based on your income and circumstances.
Has the Tax Credit Scheme Ended?
Yes. The Tax Credit scheme has been permanently closed to new claims.
You cannot apply for Working Tax Credit or Child Tax Credit anymore.
The scheme has been replaced by Universal Credit – a newer benefit that combines several payments into one monthly payment.
What If You’re Still Receiving Tax Credits?
If you’re already receiving Tax Credits, you can continue to get them for now, but you will eventually be moved to Universal Credit. This process is called managed migration and is being done by the Department for Work and Pensions (DWP).
All Tax Credit claims will end by April 2025. You’ll get a migration notice letter telling you when and how to switch.
Important: If you receive a migration letter, you must apply for Universal Credit within 3 months or your Tax Credits will stop.
How Can I Manage My Tax Credit Before Switching?
You can still manage your Tax Credit through HMRC’s services until you’re moved to Universal Credit. Here’s how:
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Update your income or personal details online or via the HMRC app.
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Renew your claim annually (if required).
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Report changes like a new job, new baby, or change in living situation.
You can do most of this using your HMRC online account or the HMRC mobile app.
What Should I Do When Moving to Universal Credit?
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Wait for your migration letter.
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Gather your personal details: income, rent, childcare costs, ID, etc.
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Apply for Universal Credit at gov.uk/universal-credit.
Tip: Universal Credit is paid monthly and combines support for:
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Housing
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Children
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Disability
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Work income
So you’ll no longer need to manage separate Tax Credit claims.
Can Someone Help Me Manage the Transition?
Yes. If you find the process confusing or need help applying for Universal Credit:
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Contact HMRC or DWP directly.
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Speak to a tax advisor or benefits expert.
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Use Citizens Advice or local council support services.
The Bottom Line
If you’ve been asking how to manage your tax credit, the answer has changed in 2025. The Tax Credit scheme is permanently closed and is now replaced by Universal Credit. If you still get Tax Credits, expect to be moved soon.
Stay prepared by keeping your information up to date and watch for your migration letter from DWP.
Need support during the switch? Our expert advisors at CruseBurke are here to help you every step of the way.
Get the best taxation advice and consultation at CruseBurke in under two minutes. Feel free to reach out to us. We’d love to help you to sort out your tax problems.
Disclaimer: All the information provided in this article on how to manage your tax credit, including all the texts and graphics, is general in nature. It does not intend to disregard any of the professional advice.