Those renewing their tax credit claims have until 31^st July 2010 to do so otherwise their payments could be stopped, say HM Revenue and Customs (HMRC).

Families tax credits, which were set up in 2003, are aimed to help the lower paid and are mainly focused on children, families, babies and people with disabilities and are available to 4.7 million households.

The tax credits are paid at different rates according to the household income, with those earning less than £16,190 a year receiving more than those earning at the ceiling rate of £58,000.  It is estimated that nine in every ten families with children can currently claim tax credits.

Under the new government plans, tax credits will be paid at the same rate for those earning £16,190 a year but with a reduced rate for those earning between that amount and £40,000. The child element of the credit will rise by £150 above inflation.

Under these new measures, by 2012-13 only six in every 10 families will be entitled to these payments.

For more information on how to renew your claim for tax credits click here.

What if you miss the deadline?

If you’ve been sent an Annual Declaration and don't renew:

• your payments will stop
• you will have to pay back any money from the previous tax year that you weren't entitled to
• you will have to pay back any money paid to you since the start of the new tax year

You’ll get a statement from the Tax Credit Office about your tax credits payments. You then have a further 30 days to provide the information asked for. If you don’t provide the information within 30 days, you will usually have to make a new tax credits claim. 

You can order a tax credits claim pack from the Tax Credit Helpline on 0845 300 3900