tax credits and dividends - baby due in jan 2012

lucyloves

Hi, i'm trying to work out whether my husbands company dividends count as additional income for tax credits/benefits? He is employed, not self-employed, but takes dividends from the company. his wage is 8k yearly and then any profit he takes dividends.

I was told that he can claim working tax credits too, but then it says its a joint application. if i go back full time after baby born then i'll be on 28k year.

also, when can i claim? should i apply now? I'm 5 months pregnant.

thanks!

del76

It's a joint application for household income, you put dividends in as additional income. If your wage was 28k till you stopped work and he takes 8k as wages then as long as dividends are under about 6k you may get something. Over that and I don't think you'll be entiteled otherwise every company director would be claiming tax credit as we all pay ourselves 7.5k (the maximum before paying tax.) and with the remainder to be paid by dividend. Same place you would declare a dividend from any other shares you hold.

If this wasn't the case you could have a £100,000 profit taken as a dividend and still be able to claim tax credits...... not really fair is it?

lucyloves

Hi del, thanks for clearing that up for me.

Does anyone know when should I apply, do I wait until baby is born?

karenx

If your joint income just now is 28k and you have no children you could apply now but you wont get anything. As you are earning far too much. You wont qualify for any working tax credits after baby is born but will get some child tax credits