This is the first time that the benefit has risen in four years since benefits were frozen by Conservative chancellor George Osborne in 2016.
Working Tax Credit is money that is provided by the government to those who are working on a low income.
As of 6 April, some claimants will see their income rise increase by 1.7% to bring it in line with inflation. The basic element of Working Tax Credit has been increased by £1,045 to £3,040 for a year from 6 April 2020 until 5 April 2021. It should be noted that the exact amount each claimant will benefit from is calculated in accordance with their level of household income.
In addition, the government is uprating Child Benefit, other tax credits rates and thresholds, and Guardian’s Allowance by 1.7% with effect from 6 April 2020.
The government had already confirmed that the benefits freeze would end in 2020, but has gone further than originally planned in response to coronavirus. The rise will undoubtedly be a welcome change as the coronavirus lockdown continues to affect many. Although the changes take effect as of 6 April, they will come into effect at different times depending on each individual's circumstances.
If you are already entitled to tax credits, you don't need to take any further action. HMRC's tax credits calculator can help you to get an estimate of how much you could get in tax credits in a four-week period.