Quick Question about Tax Credits

daisy_jean

Basically myself and my husband are currently receiving tax credits of 86.20 every 4weeks, for our dd (3months).

This is based on our income last year of 24,800 (my husband was unfortunately unemployed for 4months which made our total income really dip.).

I've estimated our income for this tax year to be approximately 28,000 - this is based on my husband's current salary (he doesn't get overtime), my wage for the year (including maternity pay, and what my pay will be when I go back in January part time).

Do I need to inform tax credits about this now? From what I gather, this shouldn't affect the payments for this tax year - is this right? As it's not gone up by more than 25,000 (I wish!). Or can I wait till nearer the end of the tax year - like Jan/Feb time?

I find the whole benefits system confusing, having never really used it until now!

Murgatroyd21

You say you included maternity pay, have you discounted the amounts you are allowed? If you get more than £100pw SMP you can discount £100 for each week in the current year you got SMP up to a max of 39 weeks (£3900). If SMP was less than £100pw you can discount all the SMP for a max of 39 weeks amounts.

If last years income was lower then that would be the figure used for calculating the current entitlement, so you can tell them your current year entitlement now.

daisy_jean

Murgatroyd21 wrote: »

You say you included maternity pay, have you discounted the amounts you are allowed? If you get more than £100pw SMP you can discount £100 for each week in the current year you got SMP up to a max of 39 weeks (£3900). If SMP was less than £100pw you can discount all the SMP for a max of 39 weeks amounts.

If last years income was lower then that would be the figure used for calculating the current entitlement, so you can tell them your current year entitlement now.

Oh, I didn't realise you could discount £100 per week of maternity pay.

I'm on the bog-standard £124.odd per week - so I discount £100 of that then? Wow!

That brings our total for this year down to less - about 24,200 then.

Lordie, this Tax Credits malarky is very confusing!

Murgatroyd21

Remember to count the weeks you got SMP in the current year, i.e. from 06/04/2010 until you start back work. If it equals 39 weeks then 39 x £100 = £3900 or substitute 39 for the weeks it actually is to get your total disregard. If on the other hand it was SMA (Statutory Maternity Allowance), not SMP, you could discount the whole amount paid as SMA. Too, if your partner took paternity leave, he can discount £100 x 2 = £200, if taken in this tax year.