tax credits and effects of redundancy and notice pay

addleclay

About to be made redundant in July. Redundancy payment £30k but also due another 4 months pay which is taxable and will show on my p45. My question is how will this effect my tax credits claim? Wife works 21 hours and gets approx £12.5k - what effect / extra benefits are possibly due to no longer receiving income or will these payments mean I won't get anythingelse? (2 kids ,5 & 2, childcare £60 per week)

cheers ac

Sunshine12

Have you been on entitledto.com? I think it will give you an idea. I would imagine if you have £30k on its way to you that they will expect you to live on that as opposed to giving you any extra.

addleclay

when i spoke to tax credit people they said up to 30k redundancy would not effect award

aurorahelios

The redundancy pay is disregarded for tax credits as its not taxable, the pay will form part of your claim. With your wife only working 21hrs a week and you not working i don't think you will be eligible for the childcare element of tax credits, the threshold for a couple is 30hrs week.

The redundancy pay will prevent you from claiming most benefits. If you've paid enough NI contributions then you will be eligible for contributions based JSA for 6 Months this is taxable and the income will be taken into account for your tax credits award.

addleclay

i'm thinking of paying the redundancy into my mortgage (nationwide creating a credit reserve) would this in theory remove this lump sum from any benefit consideration?