Accredited official statistics

Child and Working Tax Credits Finalised Annual Awards 2022 to 2023 Main Commentary

Published 24 July 2024

1. About this release

These statistics focus on the estimated number of families benefitting from Child Tax Credit (CTC) and/or Working Tax Credit (WTC) in England, Scotland, Wales and Northern Ireland during the tax year ending 2023 (6 April 2022 to 5 April 2023).

This publication presents a breakdown of families by their profile position, type of family and family size.

It also includes statistics on families benefiting from each of the different elements of tax credits and provides information on the income used in calculating awards.

1.1 What are tax credits?

Tax credits are a system of financial support for families and can be claimed jointly by couples or single adults. The amount of support is known as a family’s ‘entitlement’.

A family’s entitlement changes with their daily circumstances and is based on the following factors:

• age

• income

• hours worked

• number and age of children

• childcare costs

• disabilities

For further information about who can claim please refer to the benefits page on GOV.UK.

2. Main headlines

The number of families claiming tax credits has steadily fallen since tax year ending 2011, when changes to the tax credit system were implemented.

In tax year ending 2023, there were an estimated:

• 1,202,000 families claiming tax credits - this is an estimated fall of 308,000 (20%) compared to the previous year (Figure 1)

• 2,263,000 children in tax credit claiming families - this is an estimated fall of 612,000 (21%) compared to the previous year

There have also been several policy changes during this period which have impacted these figures. These are:

• changes to the tax credit system implemented in April 2011
• start of the Universal Credit (UC) rollout in April 2013
• the full rollout of the digital UC service across the country in December 2018
• the closure of new tax credits claims in December 2018
• the temporary WTC uplift from April 2020 to April 2021

Figure 1: Estimated number of families (millions) receiving tax credits, from tax year ending 2009

3. Section 1: Time series

In general, there has been a downward trend in the number of recipient families for all categories of benefits since tax year ending 2013 (Figure 2).

Between tax year ending 2022 and tax year ending 2023, the estimated number of recipient families fell from:

• 598,000 to 467,000 for in-work, WTC and CTC, a decrease of 22%

• 427,000 to 339,000 for out-of-work, CTC only, a decrease 21%

• 351,000 to 281,000 for in-work, CTC only, a decrease of 20%

• 135,000 to 116,000 for in-work, WTC only, a decrease of 14%

The order of size of recipient categories has remained constant with the largest as ‘in-work WTC and CTC’, followed by ‘out-of-work, CTC only’, with ‘in-work, CTC only’ as third, and then finally ‘in-work WTC only’.

Figure 2: Estimated number of families (millions) receiving tax credits by tax credit type, from tax year ending 2013

Figure 3 shows that estimated annual entitlement remained at similar levels between tax year ending 2013 and tax year ending 2016, at an estimated £28.4 billion. From tax year ending 2017 there has been a gradual decrease in estimated annual entitlement to tax credits to an estimated £8.8 billion in tax year ending 2023.

Between tax year ending 2022 and tax year ending 2023, the estimated annual entitlement to tax credits fell from:

• £5.7 billion to £4.6 billion for in-work, WTC and CTC, a decrease of 19%

• £3.2 billion to £2.6 billion for out-of-work, CTC only, a decrease 17%

• £1.5 billion to £1.2 billion for in-work, CTC only, a decrease of 18%

• £0.4 billion to £0.4 billion for in-work, WTC only, a decrease of 10%

Figure 3: Estimated annual entitlement (billions of £s) by type of tax credits, from tax year ending 2013

4. Section 2: Summary

4.1 Summary of composition of tax credits

The most common type of tax credit received is ‘in-work, WTC and CTC’ for both singles and couples. For sole parents, this is followed by ‘out-of-work, CTC only’. However for couple families, the next most common type is ‘in-work, CTC only’. The least common tax credit type is ‘In work, WTC only’ for both singles and couples.

Figure 4a: Estimated number of families (thousands) receiving tax credits by tax credit type, split by family type, tax year ending 2023

Tax credit type	Singles (thousands)	Couples (thousands)	Total (thousands)
In-work, CTC only	87	194	281
In-work, WTC and CTC	264	203	467
In-work, WTC only	68	48	116
Out-of-work, CTC only	226	113	339

Figure 4b: Estimated number of families (percentage) receiving tax credits by tax credit type, split by family type, tax year ending 2023

Tax credit type	Singles	Couples	(%)
In-work, CTC only	31	69
In-work, WTC and CTC	57	43
In-work, WTC only	59	41
Out-of-work, CTC only	67	33

Table 1: Data for Figure 4, number (thousands) and percentage of families by tax credit type, split by family type, tax year ending 2023

Tax credit type	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
In-work, CTC only	87	31	194	69	281
In-work, WTC and CTC	264	57	203	43	467
In-work, WTC only	68	59	48	41	116
Out-of-work, CTC only	226	67	113	33	339

4.2 Children in recipient families

Couples generally make up a higher proportion of larger families, with an estimated 71% of families with 4 or more children composed of couples, compared with an estimated 30% of 1 child families.

The distribution of children includes all children or qualifying young people in families receiving tax credits. This may not be equal to the number of children for whom the family is receiving the child element of CTC due to the policy to provide support for a maximum of 2 children, affecting children born after 6 April 2017 unless they are covered by an exception.

Figure 5a: Estimated number of families (thousands) receiving CTC by number of children and family composition, tax year ending 2023

Number of children	Singles (thousands)	Couples (thousands)	Total (thousands)
1 child	273	114	388
2 children	197	189	386
3 children	74	127	200
4 or more children	33	79	112

Figure 5b: Estimated number of families (percentage) receiving CTC by number of children and family composition, tax year ending 2023

Number of children	Singles	Couples	(%)
1 child	70	30
2 children	51	49
3 children	37	63
4 or more children	29	71

Table 2: Data for Figure 5, estimated (thousands) and percentage of families receiving CTC by number of children, split by family type, tax year ending 2023

Number of children	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
1 child	273	70	114	30	388
2 children	197	51	189	49	386
3 children	74	37	127	63	200
4 or more children	33	29	79	71	112

4.3 Entitlement bands

Figure 6 shows estimated total families receiving tax credits by annual entitlement, with the largest proportion of families (an estimated 21%) receiving an annual award between £6,000 to £7,999.

Figure 6: Estimated number of families (thousands) receiving tax credits, by entitlement band, tax year ending 2023

Entitlement band	Families (thousands)
Under £2,000	116
£2,000 to £3,999	236
£4,000 to £5,999	149
£6,000 to £7,999	247
£8,000 to £9,999	173
£10,000 to £11,999	108
£12,000 to £13,999	70
£14,000 to £15,999	43
£16,000 and over	61

Table 3: Data for Figure 6, number (thousands) and percentage of families receiving tax credits by annual entitlement band, tax year ending 2023

Entitlement band	Families (thousands)	% of families
Under £2,000	116	10
£2,000 to £3,999	236	20
£4,000 to £5,999	149	12
£6,000 to £7,999	247	21
£8,000 to £9,999	173	14
£10,000 to £11,999	108	9
£12,000 to £13,999	70	6
£14,000 to £15,999	43	4
£16,000 and over	61	5

5. Section 3: Detailed figures

Figure 7 shows estimated average weekly support with childcare costs for claimant families. The costs claimed for range from under £20 to over £250 a week. Lone parents across all cost bands make up the majority for eligible childcare costs.

Figure 7a: Estimated number of families (thousands) receiving childcare costs by cost band, split by family type, tax year ending 2023

Cost band	Singles (thousands)	Couples (thousands)	Total (thousands)
Under £20	9	2	11
£20 to £39.99	10	3	13
£40 to £59.99	8	2	9
£60 to £79.99	5	1	6
£80 to £99.99	4	1	5
£100 to £119.99	3	1	4
£120 to £139.99	2	1	3
£140 to £159.99	2	1	3
£160 to £179.99	4	1	6
£180 to £199.99	1	0	1
£200 to £249.99	1	1	2
£250 and over	4	3	7

Figure 7b: Estimated number of families (percentage) receiving childcare costs by cost band, split by family type, tax year ending 2023

Cost band	Singles	Couples	(%)
Under £20	80	20
£20 to £39.99	80	20
£40 to £59.99	79	21
£60 to £79.99	78	22
£80 to £99.99	76	24
£100 to £119.99	75	25
£120 to £139.99	75	25
£140 to £159.99	74	26
£160 to £179.99	78	22
£180 to £199.99	63	37
£200 to £249.99	60	40
£250 and over	53	47

Table 4: Data for Figure 7, estimated number (thousands) and percentage of of families receiving childcare costs by cost band, split by family type, tax year ending 2023

Cost band	Singles (thousands)	Singles (%)	Couples (thousands)	Couples (%)	Total (thousands)
Under £20	9	80	2	20	11
£20 to £39.99	10	80	3	20	13
£40 to £59.99	8	79	2	21	9
£60 to £79.99	5	78	1	22	6
£80 to £99.99	4	76	1	24	5
£100 to £119.99	3	75	1	25	4
£120 to £139.99	2	75	1	25	3
£140 to £159.99	2	74	1	26	3
£160 to £179.99	4	78	1	22	6
£180 to £199.99	1	63	0	37	1
£200 to £249.99	1	60	1	40	2
£250 and over	4	53	3	47	7

The amount of tax credits a family receives depends on their level of income. Awards based on an income up to £6,770 (the income threshold for year-ending 5th April 2023) receive their maximum entitlement whereas for incomes above this amount the award is tapered (see the Child and Working Tax Credit Entitlement section for details).

The vast majority (an estimated 90%) of families receiving tax credits had incomes used to taper awards of under £30,000 (Figure 8). The most common income bracket was £10,000 to £19,999. Broadly speaking, the higher the income used to taper the award, the fewer the numbers of families in receipt. This reflects the targeted approach to financial support that is inbuilt into the tax credits system.

Figure 8: Estimated number of in-work families (thousands) by income used to taper awards

Income	Families (thousands)
Up to £6,770	92
£6,770 to £9,999	144
£10,000 to £19,999	355
£20,000 to £29,999	184
£30,000 to £39,999	71
£40,000 to £50,000	16
Over £50,000	2

Table 5: Data for Figure 8, estimated number of in-work families (thousands) by income used to taper awards, tax year ending 2023

Income	Families (thousands)	% of families
Up to £6,770	92	11
£6,770 to £9,999	144	17
£10,000 to £19,999	355	41
£20,000 to £29,999	184	21
£30,000 to £39,999	71	8
£40,000 to £50,000	16	2
Over £50,000	2	0

6. A National Statistics publication

National Statistics are accredited official statistics. They are produced to high professional standards as set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

The United Kingdom Statistics Authority has accredited these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.

Accreditation can be broadly interpreted to mean that the statistics:

• meet identified user needs

• are well explained and readily accessible

• are produced according to sound methods

• are managed impartially and objectively in the public interest

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Once statistics have been accredited as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.

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7. Contact details

7.1 Benefits and credits statistics

Media contact: HMRC Press Office

Statistical contact: M Parker