Working Tax Credits

System

21Twinkle wrote: »

Here's a straight forwards question
Do WTC's depend on earnings or savings or a combination of both ?
If savings - what are the rules ?

Taxable Income which includes employment and self-employment income, such taxable benefits as JSA and IB. Also the interest on savings (not ISA'S).

50Twuncle

Exactly - and earnings from previous employment
Also any redundancy payments

DreamerV

21Twinkle wrote: »

I understand that there is also an overriding rule
If the claimee has savings that raise more than £2000 pa in interest - no WTC is payable - what interest rate do DWP assume ?
Probably 10% ?

Tax credits are paid by HMRC not DWP. It's not true that if savings raise more than £2000 pa in interest that no WTC is payable. Your taxable income (including employment, self employment, benefits in kind, taxable benefits and other incomes e.g. interest from savings over £300, dividends, property income, etc, etc) has to be below a certain amount. There is nothing to say the savings' interest has to be equal or less than £2000. Out of interest, where did you get that information from, as I have never heard that misconception previously (although have heard many others)?

DreamerV

21Twinkle wrote: »

Exactly - and earnings from previous employment
Also any redundancy payments

You don't need to count redundancy payments under £30,000. For redundancy payments over this level, only the excess has to be counted. Earnings for the previous tax year and current tax year are taken into account, irrelevant of the number of jobs. So if you had earnings from a previous job, yes you'd need to declare it, just like if you had earnings for your current job.

50Twuncle

DreamerV wrote: »

You don't need to count redundancy payments under £30,000. For redundancy payments over this level, only the excess has to be counted. Earnings for the previous tax year and current tax year are taken into account, irrelevant of the number of jobs. So if you had earnings from a previous job, yes you'd need to declare it, just like if you had earnings for your current job.

Thanks - and they knock it off - pound for pound ?
Incidentally - I was told the £2000 rule by someone "associated" with DWP