Tax credits confusion...

LL30

Hiya,

I'm confused by the £10K disregard and was wondering if someone could clarify for me so I don't get in a pickle.

Last year I claimed TCs for the first time due to maternity leave. They did it based on an estimate for that year due to a dramatic drop in wages (due to the £100 p/wk disregard whilst on SMP). Anyway, I earned £6K (give or take a few £s) and my new claim is based on last years income as is the norm. I am about to be made redundant but have some interviews lined up, but very much doubt I'll have continuous employment and therefore will have to adjust my claim accordingly (leaves me in a nightmare position for childcare when I do secure employment - how will I afford the first months payment???). Anyway, looks like I'll have to go full time now, so a big increase in wages. So far this year, I've earned around £4K, so if i take a job at £25K, between now and March, I'll earn around £10K - leaving me at £14 annual income, so under the 10K disregard. The thing is, I've done the calculator and due to last years earnings, I'll be entitled to £270 p/wk in wtc, ctc and childcare! That's a massive amount - will obviously be getting my wages also, so it seems crazy. can anyone shed some light on this? I don't know whether it would be better to go on an estimate for this year so i don't end up with an overpayment.

Also, and this is going to sound really silly - do you submit gross or net for final figures? i was barely taxed last year, and i can't remember what I submitted (sleep deprivation did not help and now I've realised, I'm concerned what I've done and also how this will affect my new claim!)

Am I getting myself in a mess? Just want to do the best by myself and my daughter without getting into trouble. Many thanks for any answers and apologies for my stupidity!

zagfles

Gross income (ie before tax/NI is taken off).

Yes you get a lot as it's based on last year's income if you're inside the disregard - but it'll drop come April so don't get used to it!