Really confused about WFTC

methekidsandthecat

Hi

I was wondering if anyone could give me some advice please?

I have just received my so called 'award' for the WFTC and they have taken off the entire amount for as a reduction due to income for the Working tax element. They reached a total of
Basic - £1890.70
Lone Parent £1861.50
30 Hour element £777.45
Total £4529.65
Less reduction for income of £4529.65

Yet it states on the HM site that income disregard is £25000 - so I am confused
They have my income down as £24870 - this is gross income.
They have also made an error in the Child tax element as they have stopped my daughter's payment even though she is staying on at school to do A levels - I will be contacting them about this. But my payments will drop considerably and I am not sure how I will manage. I also got the clarification for last year with the same income and the reduction due to income was only £855.28.

Thankyou for your help.
Sally

alwaysonthego_2

They use gross income not net income!

Did you estimate your figures last year?

Are you talking WTC or CTC there is no WFTC.

Your income seems too high to get WTC.

methekidsandthecat

My apologies - I meant that the WTC has been taken away and the CTC has been reduced due to my daughter being taken off ( I will be phoning them about this tomorrow as she is staying on at school to do her A levels).

I didn't estimate last year but took the figures from pay slips - I was just confused because on the HM R&C site when looking at rates is states that there is a £25000 income disregard - on second look it seems to apply to the CTC - but why then when I earn less than that (gross) do I still have £2411.15 deducted due to income (CTC element).

Me

I am still confused about this!!

redmel1621

I think you are best to phone them, make sure they have all the correct details ie income, amount of children and how many children are in f/t education...once they have confirmed that all the details are correct, ask them to explain the breakdown of your award. (They automatically remove children when they reach school leaving age, and will add them straight back on when you let them know otherwise:))

To me your income seems quite high to be entitled to WTC, although you would be entitled to some CTC as you rightly point out the income disregard is in relation to that element. As far as I can remember the WTC takes into account ALL income earned.

Did last years income rise form the previous year, and if so were they aware of the actual amount you were earning last year?

Mel x

ETA - Have you tried going on their tax credit online calculator....You don't say how many children you have...but with 3 it says that once I earn over 18 000(ish) I would receive £0 WTC)

methekidsandthecat

Hi

I have just been having another look at the £25k disregard and this seems to be about the claw back of over payments. Am I right in thinking that the over payments should not be clawed back if the gross income is less than £25k. Does anyone know what redress there is if they have clawed back even when income was below that level?

It appears that this came in in April 2007 - I have not checked the award for that year but there was definately a claw back for last year of £291 and I earnt less that the threshold.

Many thanks

CIS

Th £25K disregard is there to cover an increase in earnings - if your earnings in the current year are no more than £25K higher than last years earnings they calculate this years tax credit award based on last years income and ignore the extra you now earn.