Is CSA1 an exact science? (if so where can I get a copy of the formula) -merged-

kelloggs36

What is wrong with your tenancy agreement? Who do you rent from?

mothballed

Its my uncles. Its a house converted into bedsits and he used to live there as his principle home. The CSA class this as living as a non dependant. AFAIK there is nothing wrong with the agreement itself, it was drafted from a template often used by lawfirms in the buy-to-let market.

Do you know the official rules that classifies an NRP non dependant? I think the CSA is trying to say we are living together

mothballed

OK in a nutshell. The most tax-efficient parttime income (as far as CSA is concerned) would be £60.50 plus 50% of the mortgage interest and 50% of the council tax liability and 50% of the income support rate for one bio child (due May 09).

Who decides mortgage interest? (or does the CSA accept bank statements and allows half the interest)?

Does the CSA mortgage allowance float with a) Bank of England? b) LIBOR c) something else?

Is 50% of mortgage capital repayments allowed?

Is my pension allowed? (currently my empoyee contribution is not allowed so its frozen).

Would I be allowed half housing costs even if the house and mortgage is wholly in my girlfriends name?

Whats the income support rate for one biological child?

You mentioned £60.50 and this (i think) is the same as JSA. If I claimed JSA (before moving into girlfriends house) would the CSA deduct from this and reduce it below £60.50?

mothballed

I havde no problem with paying. I do object to be forced to work for an income that is a few quid difference from someone who is signing on.

The CSA ignores the moral and ethical poition so I dont need to answer them. I want an income that is CSA1 tax-efficient. I prefer not be a stay-at-home dad and would like a parttime job and I am exploring this now.

kelloggs36

I don't understand how you can make your income CSA1 tax efficient - what do you mean?

kelloggs36

You have misunderstood the housing costs. They allow 100% of the interest and capital repayment amount against your income in the first instance. The PWC can then apply for a departure whereby she would request that your partner's income be considered in terms of contributions towards the housing costs. AT that stage, the housing costs will be apportioned directly in relation to yours and your partner's income - without knowing what your income is, it is not possible to give any reliable figures - however, you need only concern yourself with that IF the PWC makes an application, it won't happen automatically. For this purpose, you will have 100% of the housing costs offset against your net income as well as the £60.50 for yourself and half of the £52.59 child premium and half the £16.75 family premium.

You get 50% of your pension contributions taken off your income. Eg your net income is £400 per week, and the mortgage is £250 per week, and you pay £50 per week into a pension, then your income used would be £375 per week. They would then knock off the £250 per week and £60.50 and £34.67. Your assessable income is therefore £87.33 which is halved which means your notional liability is £43.66 per week. If your partner works full time, then you won't get any reduction, so your liability would be £43.66 per week. It could be less if the PWC has assessable income of her own.

kelloggs36

Even if the mortgage is in your partner's name, you still get 100% offset against your income.

kelloggs36

If he no longer lives there then you should have your housing costs reconsidered.

mothballed

Its an expression my financial adviser uses. I think she means working out a salary that gives best earnings performance for the number of hours worked.

mothballed

I fully agree. I have been asking for it well over a year now but the CSA are set in their minds I am a non dependant. If this means living with parents then I havnt lived with a parent since 1983. Under a different circumstance I would find this quite funny.