One million families are set to receive a £301 cost of living payment between April and May, HMRC has confirmed.
The payment will be made to those who claim tax credits from HMRC and no other Department for Work and Pensions (DWP) benefits.
It is the first of three cost of living payments Tax Credit claimants will receive, totalling up to £900 overall for those eligible in 2023-24.
The first installment will be paid automatically into most bank accounts between May 2 and May 9.
For claimants of any means-tested DWP benefits, the first payment will be paid a little earlier between April 25 and May 17.
Meanwhile, claimants of Child Tax Credit or Working Tax Credit must be eligible for payments, or later found eligible, during the “qualifying week” – between January 26 to February 25 2023, and the payment will show as “HMRC COLS” in your bank accounts.
If you are already eligible, you do not need to apply for the payments.
Two more cost-of-living payments of £299 and £300 are due in the spring of 2024. The exact dates of the payments and the qualifying period have not yet been announced.
All the cost of living payments will be tax-free, do not count towards the benefit cap, and will not have any impact on existing benefit awards.
The payments are part of a package of wider government support announced to tackle the cost-of-living in 2023-24, including a further £300 cost-of-living payment for eligible families in autumn 2023, with a payment of £299 in spring 2024.
Angela MacDonald, HMRC’s deputy chief executive and second permanent secretary, said: “The £301 cost of living Payment will deliver vital financial help to eligible tax credit customers across the UK. Further support will be paid in autumn 2023 and spring 2024 to those entitled to payment.
“HMRC will pay eligible tax credit customers automatically and with no action required from the customer, to make this as simple and helpful as it can possibly be.”
