is tax credits based on the previous years

March2012

income? so if we are March 2012 now is it based on april 2010 to april 2011?

bloomingflower

March2012 wrote: »

income? so if we are March 2012 now is it based on april 2010 to april 2011?

Tax Credit payments for 2012-2013 will be based on previous yr income 2011-2012..

You should be receiving a renewal pack very soon. You just write your total year end income for 2011-2012 on the form and send to HMRC.
You can find your year end figure on your P60 which you should also be receiving very soon. Or you can also get it from your March wage slip for 2012 (end of March)

March2012

may be a different amount ( a bit higher for the year after such as the one just finishing now). what happens in this case?

bloomingflower wrote: »

Tax Credit payments for 2012-2013 will be based on previous yr income 2011-2012..

You should be receiving a renewal pack very soon. You just write your total year end income for 2011-2012 on the form and send to HMRC.
You can find your year end figure on your P60 which you should also be receiving very soon. Or you can also get it from your March wage slip for 2012 (end of March)

bloomingflower

March2012 wrote: »

may be a different amount ( a bit higher for the year after such as the one just finishing now). what happens in this case?

The current payments you are receiving now were based on your 2010-2011 income.

If your income for 2011-2012 is higher than income for 2010-2011 you may see a reduction in this years payments.(from April 2012)

However,there will be quite a few changes with regards to tax credit payments for this year in relation to the Budget changes/cut backs etc..

To explain in more detail, please read this link I have given you>>http://www.hmrc.gov.uk/taxcreditsbudget/index.htm

The new rules are quite complex so you might need to read all of the above to get a clearer picture of what's in-store for the upcoming tax year. There are a few examples and rough guides which demonstrate different scenarios relating to the new rules etc..

March2012

can anyone help with this if tax credits if based on previous years how do you work this out:

1) 2010-2011: very low income
2) 2011-2012: income of about 10K

he got a form in march but with new tax credits form from april (so we need to work out why).
3)2012-2013: how do we work out money for a person on his own with no child for that year.

Thanks in advance for any addtional help!

bloomingflower wrote: »

The current payments you are receiving now were based on your 2010-2011 income.

If your income for 2011-2012 is higher than income for 2010-2011 you may see a reduction in this years payments.(from April 2012)

However,there will be quite a few changes with regards to tax credit payments for this year in relation to the Budget changes/cut backs etc..

To explain in more detail, please read this link I have given you>>http://www.hmrc.gov.uk/taxcreditsbudget/index.htm

The new rules are quite complex so you might need to read all of the above to get a clearer picture of what's in-store for the upcoming tax year. There are a few examples and rough guides which demonstrate different scenarios relating to the new rules etc..

bloomingflower

March2012 wrote: »

can anyone help with this if tax credits if based on previous years how do you work this out:

1) 2010-2011: very low income
2) 2011-2012: income of about 10K

he got a form in march but with new tax credits form from april (so we need to work out why).
3)2012-2013: how do we work out money for a person on his own with no child for that year.

Thanks in advance for any addtional help!

Below is a link from the HMRC website which explains in full detail whether you would qualify and to also work out what you could be getting each week for working tax credit.
please bear in mind that these are calculated using the old rates >>http://www.hmrc.gov.uk/taxcredits/payments-entitlement/entitlement/income-examples.htm (Scroll down to 'You only qualify for Working Tax Credit')

The new rates for WTC from the 5th April will be:>>http://www.hmrc.gov.uk/rates/taxcredits.htm
Your partner would qualify for the basic element and 30 hour element (if his working hours are more than 30) with no children.

You simply add up the two elements together to give you the total figure you are entitled to for the whole year.(2710 from April 2012)
If your income is more than £6,420, your tax credits payments will be reduced - at a rate of 41 per cent.
Your gross income is used - that is before tax and National Insurance are taken off.
you first take £6,420 away from your income of £10,000
£10,000 - £6,420 = £3,580. Next multiply £3,580 by 41 per cent.

£3,580 x 41 per cent = £1,467.80. take £1,467.80 away from total of the tax credits you're entitled to - 2710-1467.80=1242.20

1242.20 is what you would be entitled to for the whole year.
(1242 divided by 52 wks= 23.88 per week)

di3004

Hi

Sorry to hijack your thread.

Does the new income brackets still stand if you have a child with a disability (where the severe element is generally awarded).

I understand for the new coming tax year it will be £26K for a couple with one child, so just curious really, thank you.

(I have checked the above links posted, sorry if I missed this).

March2012

clear!
i did want to ask another question. what if he doesnot earn as much as last year at the moment can he get more on tax credits? can you give them an estimate for the year to come?

bloomingflower wrote: »

Below is a link from the HMRC website which explains in full detail whether you would qualify and to also work out what you could be getting each week for working tax credit.
please bear in mind that these are calculated using the old rates >>http://www.hmrc.gov.uk/taxcredits/payments-entitlement/entitlement/income-examples.htm (Scroll down to 'You only qualify for Working Tax Credit')

The new rates for WTC from the 5th April will be:>>http://www.hmrc.gov.uk/rates/taxcredits.htm
Your partner would qualify for the basic element and 30 hour element (if his working hours are more than 30) with no children.

You simply add up the two elements together to give you the total figure you are entitled to for the whole year.(2710 from April 2012)
If your income is more than £6,420, your tax credits payments will be reduced - at a rate of 41 per cent.
Your gross income is used - that is before tax and National Insurance are taken off.
you first take £6,420 away from your income of £10,000
£10,000 - £6,420 = £3,580. Next multiply £3,580 by 41 per cent.

£3,580 x 41 per cent = £1,467.80. take £1,467.80 away from total of the tax credits you're entitled to - 2710-1467.80=1242.20

1242.20 is what you would be entitled to for the whole year.
(1242 divided by 52 wks= 23.88 per week)

March2012

for the tax year:

1) 2009-2010 : my friend did not earn anything and did not sign

2) 2010-2011: £10k payroll + some bits of self employement (but a bit of debt) so effectively only 10K on payroll. can you claim self employment against money you earnt on payroll?

thanks in advance.

March2012 wrote: »

clear!
i did want to ask another question. what if he doesnot earn as much as last year at the moment can he get more on tax credits? can you give them an estimate for the year to come?

zagfles

di3004 wrote: »

Hi

Sorry to hijack your thread.

Does the new income brackets still stand if you have a child with a disability (where the severe element is generally awarded).

I understand for the new coming tax year it will be £26K for a couple with one child, so just curious really, thank you.

(I have checked the above links posted, sorry if I missed this).

No, if you claim disability elements the £26k doesn't apply - you'll have a higher limit. With the severe disability element as well the limit will be about £36k (assuming you work 30+ hours, bit lower if you don't).

zagfles

March2012 wrote: »

for the tax year:

1) 2009-2010 : my friend did not earn anything and did not sign

2) 2010-2011: £10k payroll + some bits of self employement (but a bit of debt) so effectively only 10K on payroll. can you claim self employment against money you earnt on payroll?

thanks in advance.

Yes you can claim trading losses against employment income - google TC825.