Help with childcare and tax credits

bellamarie25 · 18 September 2012 at 8:52PM

Hi,
I am currently claiming JSA - Contribution Based which is due to end on 11th October 2012. I have been offered a job at 16 hrs per week starting on 15th October and will be earning roughly £150 per week. My partner works 40hrs per week and gets £400 before tax. Our 2 year old daughter will need to go into childcare which will cost us £85 per week. I am just wondering how much child and working tax credits we will be entitled to?
We are paying back an overpayment of over £3,000 currently and believe we are paying back 25% per week so at the moment we get £46.39 child tax credit and £36.71 working tax credit (this is what we receive after overpayment reduction) so just wondering what help we will get when I return to work? Are we going to be better off? How much will they take with regards to overpayment once I am working? Thank you for any help you can give me.

helpfulperson · 20 September 2012 at 11:25AM

There is a lot of information on the HMRC website about Tax Credits at http://www.hmrc.gov.uk/taxcredits/index.htm This includes a tax credit calculator if you follow the Tax credits entitlement link.

CAB_Birmingham_representative · 20 September 2012 at 11:42AM

bellamarie25 wrote: »

Hi,
I am currently claiming JSA - Contribution Based which is due to end on 11th October 2012. I have been offered a job at 16 hrs per week starting on 15th October and will be earning roughly £150 per week. My partner works 40hrs per week and gets £400 before tax. Our 2 year old daughter will need to go into childcare which will cost us £85 per week. I am just wondering how much child and working tax credits we will be entitled to?
We are paying back an overpayment of over £3,000 currently and believe we are paying back 25% per week so at the moment we get £46.39 child tax credit and £36.71 working tax credit (this is what we receive after overpayment reduction) so just wondering what help we will get when I return to work? Are we going to be better off? How much will they take with regards to overpayment once I am working? Thank you for any help you can give me.

Dear bellamarie25,

Thank you for your enquiry.

When you make a claim for Tax Credits, it is calculated based on you and your partners income for the previous tax year.

At the end of the tax year (April 5th) HMRC will finalise your entitlement by comparing your current years income with that of the previous tax year. If the current year’s income is less, your final entitlement is based on the current year’s income.

We can not say how your tax credits will be affected once you start work. If the HMRC believe you are earning a reasonable amount, they may increase the amount you hav eto pay back towards the overpayment. It is always important to notify HMRC of any changes to your circumstances (i.e. whether you start work) in order to avoid further overpayments from being made.

For further information on this you can visit the following link which is headed ‘Benefits and Tax Credits for People in Work’ which can be found on www.adviceguide.org.uk :

http://www.adviceguide.org.uk/england/benefits_e/benefits_benefits_in_work_or_looking_for_work_ew/benefits_and_tax_credits_for_people_in_work.htm#how_much_working_tax_credit_will_you_get

You may be interested in getting a ‘better off’ calculation which will provide you with a approximate figure of what your financial situation would be if you start working or if you remain on benefits. This can be done by visiting your local Citizens Advice Bureau (your local bureau can be found by visiting www.citizensadvice.org.uk )

Alternatively, you may call an organization called Turn2us who specialize in providing independent benefit advice and benefit checks over the phone. You can call them on 0808 802 2000 (lines are open Monday to Friday 8am to 8pm)

If you haven’t done so already, you may also wish to look into Child Benefit for your two your old daughter. Child benefit allows you to pay towards your child’s upkeep.

Kind regards,
Birmingham CAB

Help with childcare and tax credits

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