Tax credits & temporary employment

purdown

My partner normally receives working tax credit with a second adult element added when I am unemployed for long periods between contracts. She only earns the legal minimum wage.
However, when I take up short-term employment my partner then looses the second adult element of her tax credit during the following year when I am unemployed.
In 2007 I managed to obtain a few months employment, which resulted in a very difficult 2008 with loss of tax credits and no job seekers allowance.
Short-term employment makes it impossible to build up two years of National Insurance contributions and hence no entitlement to contribution based job seekers allowance. National Insurance credits obtained while signing on don’t contribute towards any contribution-based entitlements either.

Now we are coming up to April 2009, my partner will have her full tax credits re-assessed and restored due to my being unemployed during 2008.
I can therefore look forward to a much more comfortable 2009 as a result of not finding any employment during 2008.
The second adult element of working tax credit isn’t much money, but it’s a hell of a lot better than nothing.
Prior to redundancy in 2005 I worked full time for 30 years, therefore I am not a dole scrounger.
Looks as if the rules of the welfare state discourage people from working unless employment is permanent.

DaisyFlower

Not sure why you felt the need to brag that you will have a comfortable year despite not working.

I hope your partner feels the same way and doesnt resent having to work to support you as you find it easier to stay unemployed.

purdown

By a comfortable year I mean that after a year of poverty my partner and I will now receive full tax credits and will cease being financially punished for me working the previous year.
I am not bragging, I have applied for over 500 jobs in the last year and would dearly love to obtain a good permanent job.
I have pointed out that temporary work causes loss of tax credits in the following year when you really need the money.

LizzieS_2

You don't understand tax credits at all - you certainly do not lose out from working (childcare costs can change that in some cases).

Tax credits always works on income from 1 April to 31 March (save me posting longhand, lol).

In 2008/09 (current year) your tax credits are based on household earnings for 2007/08. If your household income is less in 2008/09 then your tax credits are recalculated on that income and you get a nice payment for the monies owed.

You working does not tally to losing the 2nd adult rebate at all - it is just co-incidental in your case that your earnings matched this figure, however from what you've said you will be due an extra payment after the current years award is finalised - suggest you get the paperwork in as soon as it arrives.

purdown

Hi Lizzie,

I look at our household income on a yearly basis from April to April. Our household income has been drastically reduced from April 2008 to April 2009 as a result of me working between April 2007 and April 2008. I therefore conclude that we would have been better off during this last year if I had not worked during the previous year.
I don't understand how you think I have got this all wrong.
When I occasionally obtain employment I don't save the wages to live on during the following year. I live on them during the year I earn them. Am I doing something wrong here?