Self Employed Tax Credits

SPSconfused

Hi All,

Firstly thanks in advance if you are able to help or offer advice. Don't be too quick to judge if I do happen to say something which there is an obvious answer to... I am human.

Right, here is the situation and it relates to my friend who i am trying to advise.

She is:

Self employed with 1 child.
Homeowner

She is self employed working 20 hours a week, getting paid £14 per hour for this time. This brings her income to just under £13,000. On her self assessment she has declared the costs of doing her job (car maintenance, phone etc) as around £5000. giving her an income of £8000. Is this the figure she would declare to tax credits or would she use the £13,000?

On a side note, as a homeowner is she able to claim Copuncil tax benefit?

Thanks

SPS

Wiley

Regarding the income to declare as self employed, see this link

http://www.hmrc.gov.uk/taxcredits/start/claiming/income-hours/self-employed-income.htm

BigAunty

Home owners can apply for council tax benefit (basically any occupier of the property can)

ALIBOBSY

Even as a homeowner you can claim council tax benefit based on income/savings, but doesn't she already claim for the single adult reduction anyway, this may be worth more to her?

Ali x

Icequeen99

It is the figure on her tax return, after expenses have been deducted, that needs to be declared for tax credits.

However, £5,000 seems high, presumably she can justify that amount if queried.

Council Tax Benefit calculated income from self-employment differently to tax credits, so unlikely she will be able to deduct as much as £5000 under their rules.

IQ