Worried about tax credits, please help.

zangels

I do not work, my partner works 40 hrs per week.
We have two children age 2 and 7 years.
April 2009 - April 2010 earnings were £24350
We have received tax credits this year of around £53 pwk.
This year my partners wages are higher, a big part of his wages is commission based and no two years are ever the same.
So wage for april 2010 - april 2011 we think will be around £33000.
Will we end up owing tax credits money for the year 2010-2011?
I know they will go down for 2011-2012 payments but un sure if we will have to pay money back?
Can any one help with what my payments will be 2011-2012?

Mollycat13

If my understanding is correct, an overpayment would be incurred from April 2011 until the claim is renewed which can take until the end of July. Your provisional 2011/12 award is based on last years figures then adjusted with the actual figures you provide at renewal.

It would definately be advisable to contact tax credits now with your estimate for this year, that way, they can adjust your provisional award pending actual figures and therefore not incurr an overpayment.

This is how I've always understood it but please would someone correct me if I'm wrong.

zangels

So for the money I have had from april 2010 - april 2011 I will not owe them any back.
But I need to tell them about the higher wages befor they do my calculations for 2011-2012 to avoid an overpayment in the new tax year?

zagfles

zangels wrote: »

So for the money I have had from april 2010 - april 2011 I will not owe them any back.
But I need to tell them about the higher wages befor they do my calculations for 2011-2012 to avoid an overpayment in the new tax year?

That's right - no overpayment this year (as there's a 25k disregard for income increases) but from April you'll only be entitled to the family element ie £545 a year about £10.50pw.

You can tell them now if you want or wait till the renewal - if you wait till the renewal you'll get more to start off (till they process the renewal) and less later so it's up to you - but over the year it'll be £545.

But if your earnings next year end up being below about £30k you'll be entitled to more.

allen35

Am i right in thinking the first £2500 of decreased income in 2012 will not count for tax credit purposes

zagfles

allen35 wrote: »

Am i right in thinking the first £2500 of decreased income in 2012 will not count for tax credit purposes

Yes, from April 2012.

See 2.44 http://www.hm-treasury.gov.uk/d/junebudget_complete.pdf