Up to 30,000 families were not getting the disability element of tax credits because they did not know to tell HM Revenue and Customs (HMRC) they were receiving Disability Living Allowance.
After work by Contact a Family, Every Disabled Child Matters, HMRC and the Department of Work and Pensions, the HMRC has found a way to identify the families currently missing out and give them the correct tax credits.
Officials have also put measures in place to make sure future claimants get their full entitlements. Now all new successful Disability Living Allowance claimants will have an orange card sent off to HMRC which acts as an alert and ensures they get their full entitlements immediately.
Jill Harrison, external affairs director for Contact a Family, said: "We are delighted that those families who were missing out will now get their full benefit entitlements and welcome the government's commitment to solving this situation."
Steve Broach, Every Disabled Child Matters campaign manager, added: "Once we realised so many parents could be affected we lobbied for government to commit to addressing the issue and secured its inclusion in Aiming High for Disabled Children. Now all those families will be better off as a result."
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