My sister is so worried about tax credits in April '12

Coveredinbees!!!!

I got a letter to day, we don't get much anyway but according to this all the figures on the letter are wrong anyway. My letter states £26,000 but we have 2 children so it should be higher. Are they just trying to make people entitled to a bit of extra money think they aren't and stop claiming? I wouldn't mind not getting it if my tight employer would sort out a pay rise, haven't had one for 3 years.

smk77

MissMoneypenny wrote: »

Yet you say that "the removal of the tax credit and child benefit has made made him think even more carefully about the affordability". Speaks volumes.

What's your problem?

A hard working, higher rate tax payer takes a serious look at the affordability of children. Yes, it speaks volumes. We need more people like him who decide if they can afford kids before a night of passion!

smk77

Coveredinbees!!!! wrote: »

I got a letter to day, we don't get much anyway but according to this all the figures on the letter are wrong anyway. My letter states £26,000 but we have 2 children so it should be higher. Are they just trying to make people entitled to a bit of extra money think they aren't and stop claiming? I wouldn't mind not getting it if my tight employer would sort out a pay rise, haven't had one for 3 years.

Yes, I spoke to them earlier and there was no mention of the £32k. The lady would have had my records and seen that we have 2 kids but spoke about the £26k limit.

Give them a call and make sure that you continue to claim even if you won't get any payments.

We can all hope for pay rises.

gillianread

you have to phone them up to get the withdrawn payment thing taken off, its 32200 for 2 kids, not that the letter says it but it does on their online page,i phoned them yesterday

daviecol

smk77 wrote: »

Interesting because I remember going with my mum to the post office once a week to pick up family allowance (child benefit) when I was 5. With both parent being teachers I very much doubt that it was because they were benefit scroungers wanting to "top up their income". I'm surprised you weren't aware of child benefit. Maybe you should have taken more interest in the budget each year?

Correct, no tax credits. Married couples allowance. Given you had kids when I was 15 and therefore you will be older than I am I'm very much surprised you came out with that!

I didn't go to the post office with my mother, presumably she collected it while I was at school. Is that so unbelievable?

I didn't take much notice of the budget when I was in my early 20s, there were other more enjoyable things on my mind. Such as making babies.

I believe the married couples allowance was granted when you got married, not had children? Hence the clue in the name?

?

zagfles

monkeyme24 wrote: »

Iam asking on behalf of a friend , there 201/2012 income is approx £26,000 and the 2012 estimated amount will be in the region of £30,000 , they have weekly childcare of £100 per week are they going to be entitles to any help as of april ? does anyone know , she works 25 hrs and her husband 39 hrs per week ?
THanks guys

Yes they will be entitled.

zagfles

smk77 wrote: »

They should word them better but I wouldn't be surprised if they have deliberately done this so that people don't think that they're entitled and therefore don't act.

I didn't realise that there was a higher level for 2 kids until a couple of weeks ago. I also thought it was £25k and not £26k.

Something else I read (and can't quote it because it was a few weeks ago) said that in some cases the income threshold won't apply. There were no examples. Not sure if it's those who get the disability element of CTC. If I understand it correctly, someone has a child with DLA and is entitled to CTC also gets a disability element of £2,800 a year on top of their £10 a week so about £3,340 a year. That's a lot to lose if they are now above the threshold!

There seems to be a common misconception about the way tax credits work. Like there's some type of cliff-edge cut off once your income reaches a certain level. There isn't. There are no upper limits in the tax credits legislation at all.

Tax credits are tapered by a % of income, so as your income increases, your tax credits reduce. The more elements you are entitled to, the more income it takes to reduce your entitlement to zero. So anyone with a disability element will have a higher threshold than a family in the same circumstances without that disability element.

smk77

zagfles wrote: »

There seems to be a common misconception about the way tax credits work. Like there's some type of cliff-edge cut off once your income reaches a certain level. There isn't. There are no upper limits in the tax credits legislation at all.

Tax credits are tapered by a % of income, so as your income increases, your tax credits reduce. The more elements you are entitled to, the more income it takes to reduce your entitlement to zero. So anyone with a disability element will have a higher threshold than a family in the same circumstances without that disability element.

I appreciate the tapering. I was thinking that the disability element forms part of the current £40k threshold rather than the £15,860! My mistake!

Where the tapering does feel like a cliff-edge is for example, a joint income of exactly £40k and then a pay rise is awarded of £1,300. There is then the tax, NI plus the family element (£960) to come off! Ouch!

gillianread

there is a cutoff point, at moment 41000 after april 26000 with 1 kid, 32200 with 2, i get the basic 41 a month

gillianread

zagfles wrote: »

There seems to be a common misconception about the way tax credits work. Like there's some type of cliff-edge cut off once your income reaches a certain level. There isn't. There are no upper limits in the tax credits legislation at all.

Tax credits are tapered by a % of income, so as your income increases, your tax credits reduce. The more elements you are entitled to, the more income it takes to reduce your entitlement to zero. So anyone with a disability element will have a higher threshold than a family in the same circumstances without that disability element.

The income limit for Child Tax Credit is going down
Child Tax Credit payments depend on your circumstances and income.
At the moment, you can usually get some Child Tax Credit, as long as your income is not over the limit of £41,300. From 6 April 2012, this limit will be lower for most people.
From 6 April 2012, the income limit for you will depend on your own situation. But as a very rough guide, you might not be able to get Child Tax Credit from 6 April 2012 if:
you have one child, and your annual income is more than around £26,000
you have two children, and your annual income is more than around £32,200