working tax credit - a couple of questions

jonathanpeterbowley

hi all,

just a couple of questions about working tax credits, i'm a bit confused.

i'm 27, i graduated from a three year degree course last july, and married in december.

last tax year i earned just under £6000.

i have applied for working tax credits and they have estimated i'll get about £89 a week.

all good so far...

this tax year, i expect to earn around £18000.

i'm wondering the following: if tax credits are based on last years income, and mine was low because half the year i was unemployed due to my course commitments, does this mean that the tax office will want me to repay any tax credits they pay me this tax year?

how does this work? will i be allowed to keep the portion of the three months of backdated credits that extends into the last tax year?

the whole system confuses me and what i don't want is to be taking my £89 a week, only to find i need to repay the whole lot next year.

please help!

cheers,
jonny

whitewing

Did you do a joint claim with your wife?

jonathanpeterbowley

whitewing wrote: »

Did you do a joint claim with your wife?

yes, it is a joint claim. i was under the impression if you were married you had to claim as a couple.

DX2

jonathanpeterbowley wrote: »

yes, it is a joint claim. i was under the impression if you were married you had to claim as a couple.

You do, however in your opening post you just state what you earnt and not what you both earnt.

whitewing

Okay, I will bump this up and see if someone here can help with your query....

jonathanpeterbowley

DX2 wrote: »

You do, however in your opening post you just state what you earnt and not what you both earnt.

oh, whoops. sorry about that! she's a student nurse, she doesn't earn anything.

flea72

you will have to notify them of the increase in income, as it is going up by more than the £10k disregard

if you fail to do this you will get an overpayment and it will be claimed back

F

nannytone_2

and you wonder why the country's benefit bill is out of contorl?
when people advise others to ' lower' their income and depend on the state rather than depending on themselves!

Kimitatsu

HI jonny

You are correct in that the tax office will always base your award on last years income and this years family circumstance. So in order to avoid an overpayment you need to inform them of your projected income for the coming year. You are obliged to inform them within 30 days of a change of circumstance (which includes income) in order to avoid an overpayment.

However, if you pay into a private pension (not a company one) then this can also be deducted from your earnings but you need to declare it on this form:

http://www.hmrc.gov.uk/forms/tc825.pdf and this reduction in income is also taken into account. Read the form carefully and don't forget to "gross up" the amounts. Eg gift aid donations of £80 means you put £100 on the form, inc the tax relief, and similarly for personal pension contributions.

HTH

paddedjohn

redbu wrote: »

There is nothing wrong in advising someone of their different options.

Or do you have a vested interest in making sure as few people as possible claim benefits?

If so, then you are on the wrong website - this site is for advising people of their entitlement and how to go about legally claiming it.

Using your comments you are telling the poster that he should be happy with the £18,000 he is earning instead of showing him how he could receive more.

We have all got a vested interest in making sure as few people as possible claim benefits, its our money being doled out and this is a money saving site after all.;)
The cash in the kitty is there for the needy and clearly the op is able to earn his own money.

flea72

nannytone wrote: »

and you wonder why the country's benefit bill is out of contorl?
when people advise others to ' lower' their income and depend on the state rather than depending on themselves!

well at least redbu gave the cheapest option. personally i would have suggested they had a baby, as that would mean they could get even more benefits, without having to worry that they earn a few £k more from one year to the next

F