Can you refuse a payrise?

starlite_2

I am just wondering as my OH is about to have his annual review and will recieve a payrise of £1000pa, but this will drastically cut the amount of tax credits we recieve, and leave us much worse off financially.

Is it possible to turn it down? And is it wrong of us to do so just because of the tax credits situation?

He is on a training programme and when that finishes next march his salary will increase quite dramatically, at which point we will no longer have to rely on the tax credits, but until then they are essential for us to get by and there is no way we will manage if they are reduced.

Thanks in advance.

piratess

I think the whole way this system works is disgusting almost as if noone wants us to get on in the world!

My partner was told his wages would go up recently by £1,000 a year! so i rang the tax credits helpline to check how it would affect out money! they said that because he wasnt earning over £25,000 they wouldnt need to do anything and our payments would stay the same ! until April! and then it would get re assessed but she said that it wouldnt make a big difference to what we get now !

knowing their track record i find this very hard to believe .. could you not ring them and check ? and go from there ... I know its difficult because you dont know which way to turn for the best !

good luck

tazzababe

Hiya,
You could try to work out what his earnings would be and input it into a benefits calculator. I think it is entitledto.com, this may give a rough estimate. As for declining the raise, I'd say Yes if it drastically affects things. I refused a xmas bonus and sales target bonuses because of the effect on TC. I felt left out, but if I had taken the money then I would have been worse off.

greenstick

Hi Starlite

I am not in a situation where I have to rely on tax credits but the tax paying part of me says yes, it may be a little wrong...However, it appears this would be short term and your OH will be earning considerably more money soon, and therefore paying more back tax into the system so I wouldn't worry.

Would it be possible to:
1. have this payrise added onto the large one coming his way in a few months
2. "Exchange" it for more training/leave

I guess it depends on the company, all he can do is ask and explain the situation.

Good luck

pandas66

Put it in a pension, tax free and doesn't count in to gross salary.

hjb123

Its a hard one that - I guess you could refuse it but your best thing to do would be to find out what you are entitled to before pay rise and after pay rise and see what the financial difference is. A good benefits calculator is Entitledto. Or another option would be to pop along to the Citizens Advice Bureau and see if they are able to help you

starlite_2

Thanks for all your advice. We would lose around £3000 from the tax credits with the new wage.

He does pay into an employee share scheme, so do you think it would be viable to up his contribution to that (which means it's excluded from our 'income' for tax credit purposes?)

hjb123

So for a £1000 payrise you would be worse off by £3000? Sounds a lot to be worse off with - maybe it would be worth you looking into the pension schemes, or contributions he makes etc.

I guess it is doable what you are suggesting - it may be worth seeing what the employer says and if he does offer that much of a pay rise - how much of a pay rise would affect the tax credits - ie if his wages could go up £750, £900 etc without affecting the tax credits?

The other way to look at it would be from the tax credits point of view - I dont know much about them but would they look at it as diverting income so you still get tax credits?

robnye

pandas66 wrote:

Put it in a pension, tax free and doesn't count in to gross salary.

increase his monthly payment into the pension fund...... this gets deducted from the salary figures used for tax credit purposes

starlite_2

This was my concern, not only officially, but ethically, is it right for us to basically cheat the system (albeit in fairly innocent way)

The fact is we simply cannot afford not to, I have no income whatsoever, no benefits except child benefit, and am unable to work.

hjb123

I can totally understand your concern where this is concerned and dont really know what I would do in this situation. I think you will have to see what the work offers by way of payrise and go from there.