Working out what we're entitled to

WaitingForAutumn

I know I'm being dim and impatient, but I can't figure out what we're entitled to, when and how to go about applying for the right things at the right time. I've looked at entitledto.co.uk etc. and am still none the wiser. I was hoping someone might be kind enough to take pity on a hormonal pregnant woman and give me the basics (as if speaking to a small child!)

Both my husband and I work. We've never claimed benefits of any kind, so are completely new to this. We're shortly expecting a baby, so things are about to change significantly. I'll definitely be taking all the maternity leave I can and am then hoping to stay off work until our daughter is old enough to start school, when I'll plan to start working again. However, I have no idea if we can live on my husband's income alone.

I know we'll get child benefit, but I get confused when it comes to tax credits etc. At the moment, we have a joint income of approximately £31,000 before tax. My husband is self employed and it's impossible to say what he'll earn. It tends to be around £17 - £18K a year, but there's no guarantee of that, especially now the industry is on the decline. When my maternity leave starts, I'll get 6 weeks at 90%, then 33 weeks on SMP. After that I'll earn nothing.

I'm assuming if we applied based on our current income, we wouldn't be entitled to anything. I'm confused as to how we submit information which takes in to account the fact that our income will change at certain stages and we have no idea what my husband will be bringing in month to month. Or does it have to be retrospective, which is a bit unfortunate if it means it doesn't help us as we go along? Also, is it purely based on income or do other factors come in to it (I still own a flat I'm renting out but am hoping to sell and my husband has been left some money from his grandmother, which he'll receive in the next couple of months)?

If anyone knows this stuff off the top of their head and it's not a big hassle, would you mind outlining which benefits we should be entitled to and an idea of how it works? I'd be really grateful. The evil alien is doing an excellent job of eating my brain and it makes me tired just thinking about it! Thank you!!

xylophone

http://recession.onespace.org.uk/index.php?option=com_content&view=article&id=61&Itemid=201 - does this help at all?
Incidentally, click on link at Step 3 - the one above it doesn't work.

MrsManda

Tax Credits is usually worked out on the basis of the previous financial year's household income but if it drops by more than £2500 you may get a current year assessment.
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/TaxCredits/DG_194914

You are unlikely to get any means tested benefits such as Housing Benefit and Council Tax Benefit as your capital (such as the house you own but rent out) and savings are taken into account as well as your income.

This may be helpful for you to look at:
http://moneyadviceservice.org.uk/parents/default.aspx

uganda

WaitingForAutumn wrote: »

I know we'll get child benefit, but I get confused when it comes to tax credits etc. At the moment, we have a joint income of approximately £31,000 before tax. My husband is self employed and it's impossible to say what he'll earn. It tends to be around £17 - £18K a year, but there's no guarantee of that, especially now the industry is on the decline. When my maternity leave starts, I'll get 6 weeks at 90%, then 33 weeks on SMP. After that I'll earn nothing.

I'm assuming if we applied based on our current income, we wouldn't be entitled to anything. I'm confused as to how we submit information which takes in to account the fact that our income will change at certain stages and we have no idea what my husband will be bringing in month to month. Or does it have to be retrospective, which is a bit unfortunate if it means it doesn't help us as we go along? Also, is it purely based on income or do other factors come in to it (I still own a flat I'm renting out but am hoping to sell and my husband has been left some money from his grandmother, which he'll receive in the next couple of months)?

My advice is about housing (in the event that you are renting the place where you live, which you may not be) and council tax benefit only.

The most likely thing to stop you qualifying, once you go onto maternity pay and then nothing, is your capital. It sounds like the money your husband may have been left may be substantial, and your property will be taken into account.

However, it may be that you do not have much equity in the property you rent out, especially in the current climate - if there are mortgages and loans secured on it this is all deducted from the value. The rental income will be taken as capital too, rather than income, but again the letting costs, including mortgage payments, are deducted.

You should tally together all your capital - from property and inheritance right down to a forgotten bank account with a fiver sitting in it - and if it comes to more than £16,000 you will not qualify for either benefit. If it is under £6000 it will not affect your entitlement, and if it is between £6000 and £16,000 you will be presumed to have £1 per week income for each £250 or part thereof. Let's say you have £10, 004 this will work out as notional income of £17 per week (called tariff income).

This £17 would then be added to all your other income, you and your husband's earnings, maternity pay and tax credits (child benefit is disregarded), then a calculation made.

WaitingForAutumn

Thank you very much for your help - I'll take a look at all the links.

I wasn't thinking of housing or council tax benefits, I know we won't be entitled to these. However, it's useful to have the information in case things change. I've been through one serious life changing situation in the last few years, so I know such things can happen!

I assume tax credits are based on the last financial year then - April till March? If that's the case, I guess there's no point doing anything until April when Hubby will know his income for this current year. My income will definitely go down by more than £2,500, so maybe once it's submitted I can request they review it.

Thanks again. x

Sixer

Note that for tax credits, you discount £100 per week of your maternity pay.