Tax Credits cuts - don't know what to do

JenJen87_2

Me and my partner combined earn around £45-46K a year, we do receive a small amount of tax credits, and of course child benefit. I have 2 children under the age of 3 , who are both in nursery as i work 30 hours a week, and yes our nursery fees are alot, £210 a week to be precise, which is not much different to yours, but you work 18 hours? This i dont understand.

Also, I wouldnt say that we struggle? We go out for family meals, we buy nice clothes... however i shop at Aldi, i drive a 10 year old xsara picasso ( which i love ) and we have freeview! And i in no way see this as living 'frugally.' We live in a rented house for £650 per month, and we're still managing to save money toward a mortgage.

If you are struggling that much then obviously you need to take a closer look at what you're spending your money on and maybe prioritise somewhere along the line.

Blue22

melly1980 wrote: »

Correct, but what else is in there? Because up to now we have the assumption that they spend 5K on petrol (they both could work 3 mile away from home for all we know). The only fact we know is the childcare cost. I will bet a pound to a pinch of $h1t that if you dig into this there is I-Phones each, laptops, PS3's, Full Sky package, 2 expensive cars etc etc which is fine when you can afford them but have to go if you cant. Thats just life.

The OP said that her mortgage was £650/month i.e almost 8K/annum

I thought a 1K estimate for council tax was conservative

She also said in post 6 'My husband and I drive over 300 miles a week between us which costs a fortune in petrol these days but is unavoidable for our jobs'

So even if you choose to disregard the cost of of maintaining cars and assume she has fuel efficient vehicles then that would still equate to 3K/annum.

I will also take Zagfles 3K per annum CB and Tax credit into consideration

So on 45K salary

Nett income in the region of 35k
Childcare costs 10k
Mortgage 8k
Council tax (?) 1k
Work related petrol costs for 2 people 3k
Plus CB and tax credits 3K

Which now equals £16,000 (Just over £307 a week) disposable income after unavoidable housing, childcare and travel to work. Is that really an awful lot? Well ok a family of 4 could live on it but why should a family earning a gross income of £45K only just scrape by?

When you consider that a single parent with 2 children, earning only £4992 a year has a disposable income of £289/week after housing costs

https://forums.moneysavingexpert.com/discussion/3163216

to me that's not fair and it doesn't give an incentive for any family to help themselves.

skcollobcat10

The government should have completely stopped tax credits from April this year for everybody.

Short, sharp shock treatment is the only way that people will start to cut their cloth according to their means.

It is disgusting how many families are being subsidized.

melly1980

Blue22 wrote: »

The OP said that her mortgage was £650/month i.e almost 8K/annum

I thought a 1K estimate for council tax was conservative

She also said in post 6 'My husband and I drive over 300 miles a week between us which costs a fortune in petrol these days but is unavoidable for our jobs'

So even if you choose to disregard the cost of of maintaining cars and assume she has fuel efficient vehicles then that would still equate to 3K/annum.

I will also take Zagfles 3K per annum CB and Tax credit into consideration

So on 45K salary

Nett income in the region of 35k
Childcare costs 10k
Mortgage 8k
Council tax (?) 1k
Work related petrol costs for 2 people 3k
Plus CB and tax credits 3K

Which now equals £16,000 (Just over £307 a week) disposable income after unavoidable housing, childcare and travel to work. Is that really an awful lot? Well ok a family of 4 could live on it but why should a family earning a gross income of £45K only just scrape by?

When you consider that a single parent with 2 children, earning only £4992 a year has a disposable income of £289/week after housing costs

https://forums.moneysavingexpert.com/discussion/3163216

to me that's not fair and it doesn't give an incentive for any family to help themselves.

but the point is that you have taken off a significant chunk of the bills. Christ me an my missus have 4 kids and we budget 180 - 220 per week ontop of those fixed costs that you mention. Its perfectly do able.

Blue22 wrote: »

Well ok a family of 4 could live on it but why should a family earning a gross income of £45K only just scrape by?.

equally, why should the tax payer fund taking a family from what they need to providing luxury items. The welfare state is not here to provide people with an easy living, that is not what it is designed to do.

Blue22

melly1980 wrote: »

.

equally, why should the tax payer fund taking a family from what they need to providing luxury items.

Because the OP is the tax payer! Why should her family only just survive in order to pay for other peoples children?

eyeinthesky

Blue22 wrote: »

The OP said that her mortgage was £650/month i.e almost 8K/annum

I thought a 1K estimate for council tax was conservative

She also said in post 6 'My husband and I drive over 300 miles a week between us which costs a fortune in petrol these days but is unavoidable for our jobs'

So even if you choose to disregard the cost of of maintaining cars and assume she has fuel efficient vehicles then that would still equate to 3K/annum.

I will also take Zagfles 3K per annum CB and Tax credit into consideration

So on 45K salary

Nett income in the region of 35k
Childcare costs 10k
Mortgage 8k
Council tax (?) 1k
Work related petrol costs for 2 people 3k
Plus CB and tax credits 3K

Which now equals £16,000 (Just over £307 a week) disposable income after unavoidable housing, childcare and travel to work. Is that really an awful lot? Well ok a family of 4 could live on it but why should a family earning a gross income of £45K only just scrape by?

When you consider that a single parent with 2 children, earning only £4992 a year has a disposable income of £289/week after housing costs

https://forums.moneysavingexpert.com/discussion/3163216

to me that's not fair and it doesn't give an incentive for any family to help themselves.

The single parent in your quote makes no mention of childcare costs while she works, nor any work / transport costs. They also do not own a property, so any comparison is meaningless. What they have in common with the OP, is that they are both living beyond their means. I find it obscene that a family on £45k are able to claim ANY benefits.

The obvious solution is to reduce expenditure, perhaps moving closer to work, a more fuel economic car or even a moped for one of them. A cheaper property? Maybe it would be more affordable if the lower earner stayed at home to look after the kids. They could then save the childcare costs, lose one car, and all associated costs like car tax, insurance, mot and servicing, tyres, parking etc.

Blue22

melly1980 wrote: »

but the point is that you have taken off a significant chunk of the bills. Christ me an my missus have 4 kids and we budget 180 - 220 per week ontop of those fixed costs that you mention. Its perfectly do able.

And equally why should you be paying so much in tax so that other families can budget 250 - 300 per week to cover those same costs?

Blue22

eyeinthesky wrote: »

The single parent in your quote makes no mention of childcare costs while she works, nor any work / transport costs. They also do not own a property, so any comparison is meaningless.

No I know the poster did not make any mention of childcare but from the figures she gave I deduced that she did not claim any childcare.....she would have claimed much more in tax credits if she had childcare costs.

And ok I concede that she may have work related transport costs that will impact upon her disposable income

As for one owning a property whilst the other doesn't. I don't know whether the OP pays an interest only mortgage or whether shes repaying large amounts of capital from the figure she quoted. Mind you, I also didn't take into account all those additional costs a home owner has. The buildings insurance, the life insurance, the maintenance of the house etc

I did not mean to knock the single parent but wanted to highlight how little extra the OP has in comparison to that lady. Although it appears that despite trying to explain, people just see that gross figure of 45K and assume the OP must be rolling in it.

anguk

The OP says that childcare costs are over £830 per month and also mentions that her in-laws pay something toward the childcare. So does that mean the op doesn't pay the full amount of £830 or do they pay £830 and the in-laws pay more on top of that? If so the childcare seems quite expensive for 2 kids for 18 hours (maybe a bit more if you factor in travel time). Are the children in nursery every day or just when the OP is working?

FOURCANDLES_2

skcollobcat10 wrote: »

The government should have completely stopped tax credits from April this year for everybody.

Short, sharp shock treatment is the only way that people will start to cut their cloth according to their means.

It is disgusting how many families are being subsidized.

Well I remember when the tax credits came in the odd few moaned but ahh we will no be able to stop them which is true ,the minimum wage which is paid to many who do what the educated may think is not an important job would not be enough in 2011, cleanrs,hospital workers,bin men,etc etc what a mess we would all end up in we have a moral duty to cut poverty. But with regards to this comment I would say up to last week every family with children unless very wealthy were being given tax credits etc , every self employed person with a good accountant is better off than an employee the very very rich are more subsidized and given more tax breaks than the average working family so in my view your idea is crap wake up and smell the coffee.