Childcare Voucher query

zagfles

Icequeen99 wrote: »

Your statement about people generally been better off with vouchers is mostly right, except where they have a lower PY income and so tax credits are based on that amount. In that scenario you don't gain the 41% tax credits due to fall in income.

So on one side you lose 70% childcare costs and on the other gain 20% tax, 12% NI where you have an award based on PY income.

Where the award is based on current year income, you get a 41% tax credit gain which makes it swing in favour of vouchers.

I think that is probably what you meant in your caveat about income.

IQ

Yes. I guess taking vouchers in alternate tax years may the best option overall for people with stable income - although the disregard for income falls coming in next year will complicate things...

Killmark

zagfles wrote: »

Plus tax credits of about £7600 !!!

This would go down in 2013-14 but you'd still get about £3500.

Well due to reduction in childcare costs the CTC award is much lower but still £4,593.

updated figures would be:

£27,502 (joint net income after deductions) - £12,350 (childcare costs) + £5832 (childcare vouchers) + £1,762 (CB) + £4,593 (CTC) = £27,339 net

roughly how much do you think CTC would decrease though the following year in 2013-2014?

zagfles

Killmark wrote: »

Well due to reduction in childcare costs the CTC award is much lower but still £4,593.

Don't understand - you're still using the same £12350 figure? Not reduced?

Killmark

zagfles wrote: »

Don't understand - you're still using the same £12350 figure? Not reduced?

As I understand it you can't claim childcare costs for the portion using vouchers so I reduced £12350 by £5832 (vouchers) leaving £6518 to pay, of this approx £2,000 couldn't be claimed as not registered or approved so worked out applicable amount based on £4518 of registered or approved that remained.

zagfles

Killmark wrote: »

As I understand it you can't claim childcare costs for the portion using vouchers so I reduced £12350 by £5832 (vouchers) leaving £6518 to pay, of this approx £2,000 couldn't be claimed as not registered or approved so worked out applicable amount based on £4518 of registered or approved that remained.

I make it £6470.

1920+1950+790+4518*0.7+2690*2+545

reduced by 41% of (24168-6420)

Following tax year would be based on income of 34168 if everything stayed the same, so £2370