Voluntary severance payment and child tax credits

toffee'n'tom

I'm currently considering whether to apply for voluntary severance before my employer possibly enforces compulsory redundancy in a year or so (and also move our base to about an hours drive away which i can't manage with children).

I was wondering if anyone could give me advice on the following? I can't seem to find any information on the web.

I'm a single parent and earn approx 16k. I have two children and am in receipt of child tax credit. I have a large mortgage for my income and some debt - I have no savings.

If I apply and am succesful for the voluntary severance I will receive approximately 34k (I have worked for my employer for nearly 25 years!). 30k of that would be tax free.

If i receive this payment how will this affect my child tax credits?

I may have to use the money to pay off a chunk of the mortgage.

I really don't know what to do - if i don't apply and face compulsory redundancy I will receive a fraction of that amount. can anyone help?