Earnings for tax credits

Earnings for Tax Credits

Benefits and tax credits use very precise definitions of earnings. For more information please see how earnings are defined in benefits and tax credits.

You should enter the amount you receive before Income tax and National Insurance contributions are deducted. Your gross annual earnings should be shown on your P60 .

If you have two or more jobs please enter your earnings from all employment. You should also include income from Statutory Sick Pay and Statutory Maternity (or Paternity/Adoption) Pay under gross earnings.

You should include most taxable employer-provided benefits (such as a car and car fuel allowances and childcare vouchers). No relief is given for tax-deductible payments to a share incentive plan (SIP). Employer owned living accommodation is not included. The HMRC website provides more information on which benefits-in-kind to include.

Self-employed

In most cases your you should enter your taxable net profits from self-employment. The HMRC website provides more information on income from self-employment.

If you are self employed and your earnings are considered too low, you may have checks carried out on your claim, see our Gainful Self-employment page for further information.

Foster carers

Foster carers should include income they receive for fostering as earned income. However, many foster carers are classed as being self employed and can qualify for 'Foster Care relief', an exemption against their self employed profits. This will result in many foster carers having 'nil' income for tax credit purposes. The HMRC website provides more information on fostering and tax credits.

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