Help with Tax credit threshold for 2013/14

froth

Hi I'm looking for some advice on the thresholds for 2013/14 please. Somehow I cannot seem to find a definitive answer to this anywhere on the net and I've already wasted an hour on the phone today with HMRC tax credits helpline and still not been able to get through and actually speak to someone.:mad:

My wife and I have combined gross income of approximately £31,000 for the 2012/13 tax year. We have two children of 7 and 5 and pay nothing at all for childcare.

I am in full time work (37.5 hours per week) and my wife works part time (16.5 hours per week)

As far as I understand the cut off point at which we would not be entitled to anything is £32,200 currently for 2012/13.

We are currently receiving tax credits of £94.17 or thereabouts every 4 weeks which I think is roughly correct.

Can anyone please advise whether this threshold will remain the same for 2013/14 or is it going to decrease by £5,000 and therefore disqualify us from claiming tax credits?

Also assuming that we are still eligible for it, there is a possibility that our combined gross salaries from April 2013 may rise very slightly above £32,200. If this were the case then would we need to stop claiming this benefit completely or should we carry on with it being based upon the previous years earnings.

Many thanks

Froth

Icequeen99

Your 13/14 claim will be based on income of £31,000 (i.e. your 12/13 income) unless your 13/14 income goes above £36,000.

The cut off in 13/14 for 2 children (presuming you are entitled to 30hr element) is 32,468.54.

You will likely have a small amount of entitlement in 13/14 but may lose it in 14/15.

IQ

froth

Thanks for the info Icequeen99.

So it looks like we should still get it then.:cool:

As far as I understand it, the family tax credit will be removed in October 2013 anyway and replaced with the Universal credit, though only some people will be moved on to it straight away.

Assuming we do still get Child Tax Credit for the full tax year 2013/14 though. If our earnings for that year end up being say £32,500 does that mean we will have to repay any or all of it received for that year?

EDIT: After re-reading your post, I think you already answered that question and that we would not have to repay any of it unless our earnings went >£36,000. Is that correct?

Icequeen99

Yes unless you go above 36,000 (31k + 5k disregard) you will be based on previous year income.

IQ

froth

Excellent, thanks!

Horseunderwater

Also Tax credits are not being moved to UC for anyone in the coming year - that starts in April 2014 onwards, so for now current rules will apply as IQ said.

Icequeen99

Horseunderwater wrote: »

Also Tax credits are not being moved to UC for anyone in the coming year - that starts in April 2014 onwards, so for now current rules will apply as IQ said.

A very small number of people may have a tax credits interaction in the Pathfinder and from October 2013 small numbers of TC claimants will be transitioned. April 14 was the announced date for no further TC claims, but I would guess that might change.

I suspect the bulk of people will be going across during 15/16 and later years. Although the numbers will build during 14/15.

IQ