Tax credits - deductions from income

ManicMum

Hello

I have to ring tax creds to tell them my income for 09/10.

I am aware I can deduct £300 from 'other income'. Is there anything else you are allowed to deduct? I am self-employed, employed and have property income for that year.

thanks.

no-oneknowsme

What you are asked to do is declare any other income over £300...you dont deduct anything .

If you have "other income" of (for example) £900 , you would then declare £600 in this section of the tax credits form , i.e £900-£300.

ManicMum

Ok, no need to be pedantic. I am just trying to make sure I give them the correct figures so I don't get less tax credits than I am due, as I have done in previous years.

ask a simple question ...............

no-oneknowsme

ManicMum wrote: »

Ok, no need to be pedantic. I am just trying to make sure I give them the correct figures so I don't get less tax credits than I am due, as I have done in previous years.

ask a simple question ...............

Any particular reason for the attitude or are you just having a bad morning in general !

You asked a question and i answered it.....given the arsey nature of your reply though i guess it wasnt what you wanted to hear?

Nothing pendanic about it as far as im concerned.

ManicMum

Does anyone know if you can 'deduct' personal pension contributions from joint salary declared to tax credits? These are contributions made independently and not from salary.

Have read some reports of this online but can not see a definitive answer. Someone even said you could deduct gross contributions including the 20% relief but that doesn't sound right.

thanks

zagfles

You can deduct pension contributions and gift aid, also trading losses - see form TC825 (google it). But don't deduct pension contributions you made via your employer as they will already have been deducted from your gross salary.

no-oneknowsme

The best people to ask would be one of the posters whom we know have experience of HMRC and tax credits . Maybe pm Pam17 or Zagfles ? They have both been excellent when I asked for advice.

no-oneknowsme

Cross posted , i see Zagfles answered you anyhow.

zagfles

ManicMum wrote: »

Have read some reports of this online but can not see a definitive answer. Someone even said you could deduct gross contributions including the 20% relief but that doesn't sound right.

thanks

That's exactly right. (I wrote my previous reply before reading this!)

Google TC825.

ManicMum

Thank you for that info.

I have never deducted these contributions before as didn't realise I could. (though guess that my fault as probably it is in the blurb somewhere).

Do you know if you can make corrections for previous years' tax credits claims?

At one point my husband was higher rate tax payer and his accountant never entered his pension contributions on tax return or asked about them even. It was only recently that I found out he could have got extra tax relief on them. I am so cross. Is there any facility to go back and claim relief now on tax returns?

thanks

zagfles

ManicMum wrote: »

Thank you for that info.

I have never deducted these contributions before as didn't realise I could. (though guess that my fault as probably it is in the blurb somewhere).

Do you know if you can make corrections for previous years' tax credits claims?

At one point my husband was higher rate tax payer and his accountant never entered his pension contributions on tax return or asked about them even. It was only recently that I found out he could have got extra tax relief on them. I am so cross. Is there any facility to go back and claim relief now on tax returns?

thanks

Re tax credits: not sure if you can claim back for earlier years, I'd guess probably not but it's certainly worth writing to them (don't phone - write - it's unlikely the helpline will resolve it).

The problem is that when tax credits first came out, Gordon Brown was always being accused of making things complicated so he wanted tax credits forms to be simple, a simple 2 page form with about half a dozen boxes to fill in, rather than the 20 odd page WFTC/benefits forms. But they went too far the other way, the form is TOO simple and doesn't ask questions it should be asking, like pension contributions, gift aid, trading losses etc.

So when you have these deductions you have to "fiddle" the figures on your declaration, which does sound dodgy but it's exactly what form TC825 tells you to do.

I'd say there's a case for this being their fault rather than yours, because they didn't ask the right questions on the form. Even in the notes ISTR it only mentions pension contributions and gift aid under the self-employed section - though they apply to everyone.

For tax, the tax return DOES have sections for pension contributions etc. I'd suggest sueing the accountant! Or getting him to sort it out - it might be possible to amend previous year's returns but I'm not an expert - suggest you tell the accountant to sort it or you'll be claiming off him!