Earn £60 per week and they take £57 from tax credit!

piclelilly

can this be right? I employ a partime administrator and she has lost £57.00 from her benefit because she now works 9 hours a week beacause she earns £60.00.
this seems so unfare as she enjoys the job and is going to continue.

what kind of an icentive is this for people to get of their bum and work.
it will be she is worse off as it costs her travel expenses to come to work.

no-oneknowsme

A girl i work with was offered just one hours over time per day in our place at a rate of £6.50 an hour

She telephoned HMRC tco to see what this hour would do to her tax credits claim and she was told that as her weekly wage would increase by £32.55 per (5 hrs @ an extra £6.50 per hour) , her weekly tax credits would drop by £16 per week !

She didnt take on the extra hour in the end as she begrudged loosing so much tc's.

dori2o

piclelilly wrote: »

can this be right? I employ a partime administrator and she has lost £57.00 from her benefit because she now works 9 hours a week beacause she earns £60.00.
this seems so unfare as she enjoys the job and is going to continue.

what kind of an icentive is this for people to get of their bum and work.
it will be she is worse off as it costs her travel expenses to come to work.

Are you sure it is tax credits?

The withdrawl rate for tax credits is 41%, i.e. for every £1 over the earnings limit tax credits are reduced by 41p.

Could it be that tax credits had an income from an earlier year that was well below what it actually is now?

Indie_Kid

no-oneknowsme wrote: »

She didnt take on the extra hour in the end as she begrudged loosing so much tc's.

But she'd gain extra wages.

piclelilly

i guess it depend on how much you would like an extra £16.00 per week.

no-oneknowsme

Yeah Sh1305 , i tried to tell her that she shouldnt think of the £16 tax credits that she would be "loosing" but to think of the £16 wages that she would be gaining.

Brick wall and head spring to mind though.....:rotfl:

piclelilly

hi you sound like you understand the system thanks for your reply. iam checking with her now and i will post later

no-oneknowsme

piclelilly wrote: »

i guess it depend on how much you would like an extra £16.00 per week.

To many people an extra £16 would be well appreciarted !

You have to consider that those young kids for which ctc is claimed wont always be young kids ! One day , inevitably (sp?) those kids are going to leave education and so the tc's will stop.....

laura8417

If she now only works 9 hours per week chances are she has lost the working tax credit, as you have to work 16 hours on that, unless you are in a joint claim.

no-oneknowsme

laura8417 wrote: »

If she now only works 9 hours per week chances are she has lost the working tax credit, as you have to work 16 hours on that, unless you are in a joint claim.

Well spotted !

Maybe the reason the Op has lost £57 is because she isnt working enough hours and so her working tax credits have been stopped leaving her with only her child tax credits.

shop-to-drop

no-oneknowsme wrote: »

A girl i work with was offered just one hours over time per day in our place at a rate of £6.50 an hour

She telephoned HMRC tco to see what this hour would do to her tax credits claim and she was told that as her weekly wage would increase by £32.55 per (5 hrs @ an extra £6.50 per hour) , her weekly tax credits would drop by £16 per week !

She didnt take on the extra hour in the end as she begrudged loosing so much tc's.

But she'd still be £16.55 each week better off. You can do a lot with that. It's no different than having to pay tax and NI on overtime really.