Understanding the new tax credit rules

D2875

Hi,

Just need some help as im not really understanding the new Tax Credit rules that are coming in (I'm sure im not the only one). We are both working 30+ hours a week and have 2 teenage kids still in school. Are we still going to be eligible for Working Tax Credits or are we going to be the ones who lose out. Our total salary amounts to £32k and we are currently receiving benefits entitled to us, we're just trying to work out (like so many others) how much we will be losing when the new rules come in as I just cant get my head around it

benefitbaby

You won't lose anything unless your circumstances change. People already receiving benefit will retain their current amount (called transitional protection) unless there is a change of circumstances necessitating a recalculation.

BigAunty

What new tax credit rules? If you are referring to the Universal Credit system, tax credits are being scrapped in their entirety.

Hopefully another poster will be able to direct you to the UC papers that deal with the working requirements for couples with children, according to their ages.

These papers should also deal with the transitional arrangements.

benefitbaby

Whilst tax credits are being scrapped the working style conditions will remain in UC (albeit changed a bit).

http://www.cpag.org.uk/universal-credit-factsheet

annie1975_2

Just reading through the universal credit rules and if I am reading it right,looks like some people will be worse off..At the moment extra income (private pensions etc),41% is deducted from tax credits.Under the UC rules 65% will be deducted..if that is the case looks like we will be worse off under UC than the present tax credits.

Morlock

annie1975 wrote: »

...looks like we will be worse off under UC than the present tax credits.

You and 2,000,000 other people will be worse off.

annie1975_2

Morlock wrote: »

You and 2,000,000 other people will be worse off.

Poor working man gets stung yet again..Didn't think it would be that many..
And they say work pays..

bloolagoon

Morlock wrote: »

You and 2,000,000 other people will be worse off.

Link please.

Morlock

bloolagoon wrote: »

Link please.

From the DWP's own impact assessments.

"In the steady-state, once all existing claims have been migrated to
Universal Credit, it is estimated that some 2.8 million households will have higher entitlements than they would have done under the current system, while 2 million would be entitled to less."

www.dwp.gov.uk/docs/eia-universal-credit-wr2011.pdf

"Households will be protected from changes in benefit entitlement if they are actively moved to Universal Credit from legacy benefits or tax credits, where their circumstances remain the same, through a package of transitional protection. However in the long run around 2.8 million households would have notionally lower benefit receipt under Universal Credit than in the current system."

www.dwp.gov.uk/docs/universal-credit-wr2011-ia.pdf

[Deleted User]

But if some of those 2'000'000 families include that ones with thousands of pounds in savings then that is surely a good thing right?

princessdon

Or those that think it's perfectly acceptable to work part time hours between 2 people with older children and get a top up to a virtual full time rate.

I once asked my boss if I could work part time 1/2 for 3/4 pay and for some reason they thought it was the most ridiculous notion they had ever heard of and neither did they increase my salary when I had a child.

And the good news is 2.8 will be better off