Self Employed, no set hours and Working Tax Credit. Help Please.

ACon

My husband is a self employed builder, we didnt claim tax credits last tax year because we never knew what hours he would be working, but towards the end we realised he was easily doing the 16hrs needed so the last 3 weeks he finally got some WTC based on 16 hrs and his earnings.
Then it went up to 24hrs, so it was cancelled.
My question is, as WTC is actually worked out on earnings, would it be so wrong to delcare 24hrs of work when some weeks he may not reach that. His yearly income is still declared etc so surely it doesnt matter what hours you work as self employed.

HappyMJ

Anything he does in the business counts as hours. So leafleting the neighbourhood counts as work. Doing accounts at the end of the week counts as work. What does he do to find new contracts? Does he quote for jobs? Most of that time also counts as work. He needs to keep a diary just in case he is ever asked to prove the number of hours spent on the business.

kezlou

hi, were self employed at the moment. My partner is a plumber/ gas engineer so never know what happening on a weekly basis.

What we've done is declared full times hours i.e over 30hrs and we claim tax credits based on that.

But you have to take everything into account regarding hours.
For instance he's does a quote:

2 hrs driving and to quote for the property
1 hr actually doing the quote and discussing what needs to be done with the client
3 hrs sourcing material and reckoning up the quote

So easily 6 hours to do one quote.
Say he does this 5 days a week this equals up to 30 hours a week and full entitlement to working tax credits.

Yes he hasn't earned anything fiscal wise but he has worked the hours as stated.

If he takes a trip to the merchants and is there an hours looking at materials , that counts towards his hours.

So does bookkeeping,sending letters, phoning merchants / clients, speaking to various advertising people. do the accounting, ordering materials.Taking the van to garage to get checked out. It all adds up

Oh and tax credits is worked out on earnings, but when you first claim you basically give an estimate to say what you may earn in the the financial year £10495 for 2012-2013 and your working 30 hours a week. You then have till January 2013 work everything out for the whole of 2012-2013 the tax year and declare your earnings. As your self employed you can never know how much you've earnt till the end of the financial tax year anyway.

If you need any help just give us a shout .

ACon

Thank you, thats EXTREMELY helpful to know!!

shedboy94

A word of warning......if Tax Credits have your husband working exactly 16hpw, which was the min requirement for WTC, and you then suddenly call to increase the hrs to 24 or more......just to get more WTC, then it will be looked upon as very suspicious/convenient and will be investigated.

NoBS_2

The info given by other posters is good but Shedboy has touched on something very important in his post.

The amount of people phoning to up their hours in the joint claims from 16 to over 24 is astronomical. Obviously the fact there were only 16 hours being worked before between two people and suddenly everyone wants more (and more importantly finds more) work has put them on alert.

Make sure as the posters mentioned you can account exactly for his hours because in the run up to UC, the drive targeting the self employed within HMRC is going to be huge. It's already started.

Icequeen99

Also, HMRC are investigating the claims of people who are self-employed and declare low/nil income even though they work 16+ hours.

You will have to be able to document that the majority of weeks he worked at least 24 hours - you say that he won't every week in which case you are making a false declaration. It isn't average hours either.

If your claim is checked, which it will likely be over the next year or so, you might have a real problem.

I am currently dealing with several appeals of people in similar situations who have all had their tax credits stopped as they could not prove the hours.

HMRC are not just looking at whether you work those hours but they are finding people don't because the work is not 'in expectation for payment'.

IQ

raq

Icequeen99 wrote: »

Also, HMRC are investigating the claims of people who are self-employed and declare low/nil income even though they work 16+ hours.

You will have to be able to document that the majority of weeks he worked at least 24 hours - you say that he won't every week in which case you are making a false declaration. It isn't average hours either.

If your claim is checked, which it will likely be over the next year or so, you might have a real problem.

I am currently dealing with several appeals of people in similar situations who have all had their tax credits stopped as they could not prove the hours.

HMRC are not just looking at whether you work those hours but they are finding people don't because the work is not 'in expectation for payment'.

IQ

hi there

i have read your thread with interest.

My hubby is self employed and in the decorating/diy trade. The year has been stupidly quiet. One week he done a full 36 hours for £250.00 just to get the work and get a wage. The other weeks he actually earned £1500.00. Just the way self employed goes.

Anyway, self essessment for a lot of people recently and our figures for the year *( profit ) is only £6,500.00. Got every bit of paperwork, hours, quotes, accounts work and so forth in one big file. You may look at this figure and think , "No can,t be", bit it genuinely is.

When I read threads like this , there are genuine people out there but sadly a lot of not honest people.

Glitterpix

how do you go about "proving" your hours?
Im recently self employed, I run a shop on etsy where I make accessories & laser cut acrylic jewellery.

I give myself set hours every day to work, and so I know I do exactly 25 hours, but how does one prove this if asked? I mean, you could write it all down, but so could a liar...

just wondering if anyone does anything specific? x

raq

cctv everywhere

ACon

I phoned tax credits and said that my husband is working on average a 30 hr week. When she asked what this involved (ie the jump but wage not overly changing) I said I now knew we could claim for not just his paid work, but also his driving there and back (which is usually around 2 hrs a day due to where we live) admin, searching for work, dealing with clients, sourcing materials etc. She said ok thats fine.
I wish we had known we could claim for these hours before because bar 3 weeks we have not claimed WTC the whole time he's been self employed.


As far as proving it goes, well they are going to have a job making all self employed people prove the hours put in, especially if its at home.