New rules for claiming working tax credits self employed

123457

Comments

  • Icequeen99
    Icequeen99 Posts: 3,775 Forumite
    But you are referring to permitted work higher limit. They are claiming under the lower limit which does not mention working hours, only that it must be less than £20.

    Nannytone - DS is right.

    I agree that it doesn't make sense - one is for out of work the other in work.

    As I said above, they probably didn't think anyone could work more than 16 hours and earn under £20 so they didn't set an hours limit. The hours limit is for the higher limit, it is not for the £20 limit.

    The issue here is most likely that Sherbet's self-employment just won't meet the WTC new rules.

    I wonder also whether he is getting IRESA or CBESA or both. WTC is counted as income for IRESA.

    IQ
  • nannytone_2
    nannytone_2 Posts: 12,945
    Name Dropper First Anniversary First Post Combo Breaker
    Forumite
    he transferred from incapacity benefit so would assume that its cont based .

    howmuch wtc would be involved on a weekly income of £20.

    I'm just thinking of the rule that reduces ESA cont based when a pension of more than £85 is received, surely this would apply if wtc is over £65?
  • I receive Cont Based ESA, previously it was Incapacity Benefit,


    Taken from the original post above

    It goes on to say that to be eligible for Working Tax Credits
    you should be getting paid or expect to get paid for your self employed work.
    I do get paid for my SE work.
    your self employment should be done on a commercial basis with a view to making a profit. I do make a profit, however small or I wouldn't be doing it, oh though I probably actually would as it is one thing I can actually do, and do it well. I take pleasure in my work but if I were to look elsewhere out of the home for a job, I would fall at the first hurdle as it would mean that I would have to interact with people. I never leave my home just now. If I am found to not be able to claim WTC, I wouldn't be here though I could get supporting evidence from my GP as to why I can't work more hours and outside the home.

    There should be procedures in place to support people with at least mental health issues as I am sure there are 1000's suffering that can not leave their home to work. My CPN orginally got me started with self employment and ESA and WTC as she at the time could see a benefit in my doing it - she was right.

    I may take a long time doing what I do, but that is also down to other medical problems that I have. What might take somebody 1 hour to do, can take me 3 times as long. I am currently on an indefinate award for both ESA and DLA. I could look at changing my DLA to PIP but have heard awful things about how difficult it is to get PIP, so I have held off for the moment.
  • FBaby
    FBaby Posts: 18,367
    First Anniversary First Post Combo Breaker
    Forumite
    Do you actually need the additional money you get from tax credits? ESA and DLA and other benefits are supposed to ensure disabled people have enough to live in and indeed I think with HB and the rest of it is the equivalent of a net salary much above average.

    Could you consider ending your WTC claim? You could still do your work if it helps your MH and declare your profit for the purpose of ESA and then it would be a big weight of your shoulders taking away a level of anxiety that it sounds you could do without.

    As said yyou might have an over payment but one you'll be able to repay on a very long term basis anyway.
  • Icequeen99
    Icequeen99 Posts: 3,775 Forumite
    Nannytone - WTC is not relevant for CBESA, it is only taken into account for IRESA.


    Sherbert - if you are investigated, you need to flag up to them that the work actually takes you longer due to your disability, therefore that should be taken into account when determining your hours worked. I have argued that in a previous case where the person had a physical disability that meant it took them double the time to do a task than it would normally take. That may not satisfy them as to the amount you are charging or the commercial nature but it is relevant.

    IQ
  • tomtontom
    tomtontom Posts: 7,929 Forumite
    sherbert17 wrote: »
    I receive Cont Based ESA, previously it was Incapacity Benefit,


    Taken from the original post above

    It goes on to say that to be eligible for Working Tax Credits
    you should be getting paid or expect to get paid for your self employed work.
    I do get paid for my SE work.
    your self employment should be done on a commercial basis with a view to making a profit. I do make a profit, however small or I wouldn't be doing it, oh though I probably actually would as it is one thing I can actually do, and do it well. I take pleasure in my work but if I were to look elsewhere out of the home for a job, I would fall at the first hurdle as it would mean that I would have to interact with people. I never leave my home just now. If I am found to not be able to claim WTC, I wouldn't be here though I could get supporting evidence from my GP as to why I can't work more hours and outside the home.

    There should be procedures in place to support people with at least mental health issues as I am sure there are 1000's suffering that can not leave their home to work. My CPN orginally got me started with self employment and ESA and WTC as she at the time could see a benefit in my doing it - she was right.

    I may take a long time doing what I do, but that is also down to other medical problems that I have. What might take somebody 1 hour to do, can take me 3 times as long. I am currently on an indefinate award for both ESA and DLA. I could look at changing my DLA to PIP but have heard awful things about how difficult it is to get PIP, so I have held off for the moment.

    There is support in place - that is permitted work.

    Even allowing for your disability meaning the work takes you three times as long that would only take you to £3 an hour. No viable business would succeed in the long term on such a low rate, at least not one that is not manipulating the system. I'm not suggesting that is your intention, but that's what it is.

    Do you not feel manipulated by the person that is only paying you £1.10 an hour for your work? If an employer suggested doing that there would be an outcry!
  • We got one of these letters in between Christmas and New Year, I just put it to one side thinking I will look into it in January and have done today, slightly different for us, partner is "non hobby" self employed just about to go into her 3rd full year, ,slow and steady growth she declares 30 hours worked but in actual fact works more like 60 so no worries there, have all records required etc though admittedly could do with being better organised, she is going to turn her attention to that this month.

    Profit, well not an easy thing to achieve but none the less she has, year 1 was a nominal few thousand ish, year 2 was 130% growth on year 1 leaving her within about £1 per hour of NMW, this year has been a bit slower but she is still on target to match last year if not a very small increase but she will still be around £1 per hour short of NMW and even more come April, she has a clear plan and is always marketing to find more business, this has been ramped up over the last couple of week and she is expectant of good results, we will see always had great success with Adwords but had an epic failure in December with it costing a few hundred quid! Strange times.........

    Anyway I cannot imagine for 1 minute HMRC having any serious concerns over my partners business even though she will be "officially" around £1 per hour short of NMW and a bit more come April she is also about to take on her first 2 employees this Spring on real contracts with real hours so if she is the kind of business they are "targeting" then so be it, what can you do? Not a lot, they will make a decision and we will have to live with it either way, we will manage short term if we have to and long term is looking rosy as any business really should look so not all that concerned and NOT going to allow it to stress me :)

    Happy New Year y'all :)
    "You can measure a man's character by the choices he makes under pressure"
    Sir Winston Churchill
  • Becles
    Becles Posts: 13,163
    Name Dropper First Post First Anniversary Photogenic
    Forumite
    I assume by that you mean you work less than 16hrs so aren't eligible for WTC?


    No I work full time. I can't support my children and a mortgage on less than 16 hours a week!

    I've not had a letter so I'll stop panicking :D
    Here I go again on my own....
  • Darksparkle
    Darksparkle Posts: 5,465 Forumite
    Becles wrote: »
    No I work full time. I can't support my children and a mortgage on less than 16 hours a week!

    I've not had a letter so I'll stop panicking :D

    If you work full time then you must also have a WTC claim. Even if the WTC is reduced to nil due to your income, you still have a claim for it.

    However their checks are mainly into those claiming WTC but not earning NMW.
  • Becles
    Becles Posts: 13,163
    Name Dropper First Post First Anniversary Photogenic
    Forumite
    If you work full time then you must also have a WTC claim. Even if the WTC is reduced to nil due to your income, you still have a claim for it.

    However their checks are mainly into those claiming WTC but not earning NMW.

    I get the annual award letter with child tax credits on but it says nothing is payable for WTC so I just assumed that meant I wasn't entitled to it. Apologies for using the incorrect wording.
    Here I go again on my own....
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 342.5K Banking & Borrowing
  • 249.9K Reduce Debt & Boost Income
  • 449.4K Spending & Discounts
  • 234.6K Work, Benefits & Business
  • 607.1K Mortgages, Homes & Bills
  • 172.8K Life & Family
  • 247.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards