Tax Credits - Going from P/T to F/T

diablobear

Hi there

I am a lone parent and have been claiming CTC & WTC whilst working P/T 28.5 hours p.w. My employer has asked me to increase my hours to 31.5 hours p.w. this will now be classed as F/T.

Will this change of hours affect my TC in any way apart from the fact that my earned income and childcare costs will increase slightly.

Basically, does it make any difference with tax credits if I work under or over 30 hours p.w.?

Thanks

[Deleted User]

You will now qualify for the 30 hr element which adds approx £14 p/w to your WTC. You mst work out your increased total earnings estimate for 2008/09.

As long as your earnings dont go £25k more than last year, your award wont decrease as it will still be based on earnings figure given for 2007/08.

However it will decrease from 6th April 2009 when your award will be based on your 208/09 estimate.

diablobear

Thanks for the quick reply, much appreciated. I thought that a change from P/T to F/T had some kind of impact but wasn't sure which way!!
So if I understand this right, I should receive an increase in my WTC from the date I go F/T until 5th April 2009 for working an extra 3 hours p.w.?

Just out of curiosity, do you know the reason why there is the increase when you work over 30 hours?

I think I will over estimate my earnings for 08/09 just in case, as my employer has mentioned some irregular overtime on top of the change of hours. Would you recommend this?

[Deleted User]

Not sure why there is an extra element for 30+ hrs - there just is. But as your award will decrease from mext year you wont really see the increase for more than the current year.

Yes, I would advise that you over estimate just incase your income is higher.

When you complete your annual declaration next year they will get the exact figure and if you have under estimated you will have been overpaid. If you have over estimated you should get a little bit of backdating which is a bit of a bonus!