Last year 410,000 individuals had their payments stopped or altered because they missed the deadline to inform HMRC of changes to their circumstances. These include changes to working hours, income and childcare costs, which can be submitted through Gov.uk or via the HMRC app.

The department says its online renewals system is now easier and more accessible, allowing taxpayers to track the process of their renewal, receive email confirmation once submitted, and removing the need to scan or type in the barcode number from the back of the renewals pack.

Rachel McLean, HMRC’s interim director general of customer services, said: ‘We’ve made some really helpful improvements this year to our online and app services to support our customers. We know life can be hectic so the start and stop feature allows customers to begin and complete their renewal on a day and time convenient for them.

‘It’s fantastic that 32,000 have used our app and 733,000 customers have already renewed their tax credits online.’

The Low Incomes Tax Reform Group (LITRG) has said that even if claimants, such as the self-employed, do not yet know their actual income for 2016/17 they must still submit an estimate by July 31. They have until January 31 2018 to either confirm or replace the estimate with the actual figures.

LITRG points out that the renewals process does two things: it finalises the tax year that has just ended (2016/17) and it acts as a claim for the new tax year. Even if someone no longer wants to claim or thinks they are no longer entitled, if they claimed tax credits at all during the 2016/17 tax year, they will still receive papers and must follow HMRC’s instructions to complete and finalise their claim for 2016/17.

The only exception to this will be if a tax credit claimant moved to universal credit in 2016/17. In that case HMRC should have already finalised the 2016/17 claim and so no renewal pack will be issued. 

Some claimants will receive two forms (one with a red line across it) with accompanying guidance notes. These are known as ‘reply-required’ renewals because the claimant must respond to HMRC by July 31. Other claimants will receive just one form (with a black line across it) and these people (known as ‘auto-renewals’) will have their claim for 2016/17 automatically finalised and renewed for 2017/18 but they must still contact HMRC if something on the form is wrong or they have had a change of circumstances.

Anne Fairpo, chair of LITRG, said: ‘It’s important to read the guidance notes carefully, particularly the parts that explain what counts as income for tax credits. Some of the renewal documents will show income figures that HMRC have obtained from their tax system but these may not include several deductions that are allowable for tax credit purposes and people should read the notes carefully to see if any of these deductions apply to them.

‘If using the online system to renew, claimants should make sure they enter their income figure after any deductions and carefully follow the notes that come with the paper pack.’

LITRG is also warning that this time of the year sometimes sees an increase in fraudulent activity which often targets the most vulnerable taxpayers. It says claimants should remember that tax credits can only be renewed using the official HMRC phone number, Gov.uk website, the HMRC app or by post to HMRC’s tax credit office.

There is more information about tax credits here.

The HMRC app is available free on the App Store or Google Play Store

The tax credits helpline: 0345 300 3900