New rules for claiming working tax credits self employed

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  • Darksparkle
    Darksparkle Posts: 5,465 Forumite
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    Becles wrote: »
    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.

    No problem. Make sure the award does still show your work details and the WTC elements. You still get them included even if reduced to zero and can make a difference.
  • FRESTER
    FRESTER Posts: 383 Forumite
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    Has anyone had a compliance check yet who got one of these letters after Christmas ?

    We are going away for two weeks today and its always my luck it will arrive the day we go lol and we will miss the deadline !
  • rizvan786
    rizvan786 Posts: 2 Newbie
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    Hi i need some advice, i put my claim in for working tax credit on January 20th 2016 then i had a child in May this year. My tax credits are still not through i earnt about £9000 for tax year 15/16 and then i got asked for evidence of self employment which i sent through then got told im not entilted to anything as my income was £21000 which it isnt and now i told them my income and they are saying its gone to the complex case team. Im really frusted i need some advice and whats going to happen next.
  • Darksparkle
    Darksparkle Posts: 5,465 Forumite
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    rizvan786 wrote: »
    Hi i need some advice, i put my claim in for working tax credit on January 20th 2016 then i had a child in May this year. My tax credits are still not through i earnt about £9000 for tax year 15/16 and then i got asked for evidence of self employment which i sent through then got told im not entilted to anything as my income was £21000 which it isnt and now i told them my income and they are saying its gone to the complex case team. Im really frusted i need some advice and whats going to happen next.

    Where did they get the figure of £21,000?

    Why are you considered a complex case? Normally that's only used for cross border workers and other "complex" claims.
  • rizvan786
    rizvan786 Posts: 2 Newbie
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    They said its a estimate figure where they got it from i dont know. They referred my case to complex team when i told them what my actual income is. This is the 100th time my case has been referred.
  • dktreesea
    dktreesea Posts: 5,736 Forumite
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    pmlindyloo wrote: »
    I can't quote legislation but the Gov. website clearly states that the profit made per hour should be at least the NMW. (December 2015)

    https://www.gov.uk/working-tax-credit/eligibility

    In the OP's wife situation this is clearly not a start up business and although they keep business records no profit or very little appears to be made. it seems that this business would be subject to investigation.


    Not quite. It says if your profit isn't equivalent to the NMW, presumably for the hours, if any, you are required to work, then the tax office may ask for various records/a business plan.
  • dktreesea
    dktreesea Posts: 5,736 Forumite
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    itsnotmeagain wrote: »
    I do not work i`am my wife`s carer, we have three children so receive Child Tax Credits, wife is in receipt of high rate DLA care & mobility, we were encouraged to start & run our business like this by the job centre with them knowing we would not be able to pull a full wage,

    Curious to know what HMRC steps would be as can not increase turnover without capital investment


    It doesn't mean the business isn't viable - just that it takes longer to build up to make a decent profit.


    I think your WTC will be okay, but if the self employed get moved onto UC (I would say "when" but can't really see when the "when" will ever be) then they could treat her as having to earn whatever hours she is required to work times the NMW, in which case, if her profit doesn't exceed that, deeming rules come into play. So for UC purposes, they will treat her as having that profit whether she has it or not.


    Are you sure though, she is required to work at all?
  • Darksparkle
    Darksparkle Posts: 5,465 Forumite
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    dktreesea wrote: »
    Not quite. It says if your profit isn't equivalent to the NMW, presumably for the hours, if any, you are required to work, then the tax office may ask for various records/a business plan.

    Just to say that you are quoting posts from December. Just in case you hadn't noticed.
  • dktreesea
    dktreesea Posts: 5,736 Forumite
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    rizvan786 wrote: »
    Hi i need some advice, i put my claim in for working tax credit on January 20th 2016 then i had a child in May this year. My tax credits are still not through i earnt about £9000 for tax year 15/16 and then i got asked for evidence of self employment which i sent through then got told im not entilted to anything as my income was £21000 which it isnt and now i told them my income and they are saying its gone to the complex case team. Im really frusted i need some advice and whats going to happen next.


    What was your income in the 2014/15 year? The HMRC sometimes take a long, hard look if your income drops by a substantial amount if you are self employed.


    Having said that, we once had a couple of HMRC inspectors out to our business who had done heaps of analysis. Not sure what they came up with but their first question was about our cash income and expenses we had paid for with cash. (we vary rarely have any - it's not that kind of business).
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