Tax Credit Rise - worried!

JulieABr

I'm a self-employed, single mum with two primary school boys. I just completed my tax credit review and, although my potential annual income for the coming year has increased from last financial year by about £1000 my tax credits have gone up?! How can this be right??? Surely I should be receiving less - and what happens now the emergency budget has come out - when are those changes due to start affecting my finances? (I need every penny )

themonkeybutler

If your income is low and below the tapering threshold (about £6500 ish), the rise may simply be due to the increase in rates for TC. This happens every year, so if the rise in your award is only a small one, thats probably all it is.

And none of the budget changes are coming into effect until april 2011, and then more in 2012.

toonbaz

JulieABr wrote: »

I'm a self-employed, single mum with two primary school boys. I just completed my tax credit review and, although my potential annual income for the coming year has increased from last financial year by about £1000 my tax credits have gone up?! How can this be right??? Surely I should be receiving less - and what happens now the emergency budget has come out - when are those changes due to start affecting my finances? (I need every penny )

your tax credits award is based on previous years income so because your increase in income is happening this current year it wont affect your award till next april.

System

skcollobcat10 wrote: »

If your wage as self employed is so low that you need to receive tax credits to financially get by wouldn't it be better to work for an employer?

I was thinking this because as self employed you have all the tax returns and the necessary paperwork that goes with it all.

If you are not earning a livable wage, if it was me, I would just work for an employer and let them have all the hassle.

There are lots of people working for an employer who's wages are so low that they are entitled to tax credits.

I think JulieABr, as a single parent, is to be congratulated for having the wherewithall to become self-employed and earn money to help bring up her 2 children. Lots of single parents either can't find jobs to suit around their family committments or chose not to try to find work at all.