CSA and WTC

kittkatt82

Hi, sorry I've just posted and been looking into this. The direct gov website calculator is now asking for working tax credit to be taken into account for CSA calculations. Is this right? I wasn't aware that WTC has ever been used as income so worried now we may not have been paying enough. We only qualify for a very minimum amount of WTC but have a substantial amount of the childcare element, is this taken into account too and should we be informing the CSA or wait until a reassessment. My partner pays by DDO. Panicking now! Thanks

Marisco

Yes, WTC is counted as income. If your partner earns the most, all of it is taken into account, if you earn the same, half of it is, and if you earn the most, none of it is.

HoneyNutLoop

It has always been considered on CS2, in the manner that Marisco describes, as has child tax credits, which has always been taken into account in full. The calculator has never spelled this out before, which I think has caused a lot of confusion over the subject. People get one amount from the calculator and then a different amount from the CSA.

If your partner was asked about tax credits by the CSA, or asked if he had any other source of income and he said no, then potentially the CSA could go back and recalculate what should have been paid under the grounds of misrepresentation. If they never asked, then they can't now go back over all the old calculations.

kittkatt82

Thanks for your replies. He has always paid by DDO (through choice not enforcement) so they have always gathered information through his employer. We have kept them up to date with any changes to our circumstances but have never been asked about tax credits or other income -hence i was unaware they took them into account, so not sure what to do now!

I can understand them using wtc as this is effectively an enhancement of earnings but surely if it's for both of us, half of it is mine so shouldn't be taken into account! We only qualify for a teeny amount anyway, but don't understand how the ctc can be taken into account as this is for our children who live with us, one of whom is not his, surely money paid for the benefit of children (and their childcare) can't be used to pay for another when that other child's parent recieves it in their own right??!! Child benefit isn't used, and the calculator only asks for wtc. Sooo confusing! Would ring and ask, but from my experience, most of them don't know themselves! Any clarity gratefully received! Thanks

kevin137

Are you the PWC or NRP...??? This is not clear, if you are the PWC then it is of no concern to you, it is only the NRP's income, and if HE gets WTC...

As for how it works if you are the NRP, do you have children in your household...??? If so they are disregarded from his income at a percentage as well, so it is given back by the allowance you have for YOUR children in the house wether they are his or not... SO you could have previous children and his income would be reduced by them, so how is that fair to previous children, it is a case of swings and roundabouts...

PreludeForTimeFeelers

kevin137 wrote: »

Are you the PWC or NRP...??? This is not clear, if you are the PWC then it is of no concern to you, it is only the NRP's income, and if HE gets WTC...

As for how it works if you are the NRP, do you have children in your household...??? If so they are disregarded from his income at a percentage as well, so it is given back by the allowance you have for YOUR children in the house wether they are his or not... SO you could have previous children and his income would be reduced by them, so how is that fair to previous children, it is a case of swings and roundabouts...

I believe she's the NRP's partner.

kittkatt82

Thanks for all responses. Yes i'm talking about NRP. You are quite right, it is all swings and roundabouts! Just really confused how it all works to be honest. It is not as simple as reimbursing one against the other, they are all our children in my eyes and financially are all treated equally, but don't understand how a portion of the support we receive toward childcare expenses can be considered to be an income to support the other child when her mum receives this in her own right, and without this support it wouldn't be viable for me to work.

Anyway, what I need to know is whether to inform them if we have never been asked for this info? Many thanks

kittkatt82

HoneyNutLoop wrote: »

It has always been considered on CS2, in the manner that Marisco describes, as has child tax credits, which has always been taken into account in full. The calculator has never spelled this out before, which I think has caused a lot of confusion over the subject. People get one amount from the calculator and then a different amount from the CSA.

If your partner was asked about tax credits by the CSA, or asked if he had any other source of income and he said no, then potentially the CSA could go back and recalculate what should have been paid under the grounds of misrepresentation. If they never asked, then they can't now go back over all the old calculations.

Hi honey nut loop in response to this, have contacted csa and maintenance options and both said that working tax credits is used but NOT the childcare element or ctc. Guess that puts us in the clear but wanted to let you know in case this it affects you

HoneyNutLoop

Hi, I'm really sorry, but rather worryingly you have been given incorrect information by both. Please see the attached at page 16.
http://www.dwp.gov.uk/docs/child-maintenance-faqs.pdf

cakeforbrains

The above link says:

"Both working and child tax credits are treated as a non-resident parent’s income as they are paid as a supplement to earnings. In circumstances where the nonresident parent and their partner are working, half of the working tax credits received will be included within the non-resident parent’s net weekly income in order to calculate his or her liability. If the non-resident parent’s partner receives the household primary income, no tax credits will be included as part of the income figure for the purposes of the maintenance calculation. Child tax credits paid to either the non-resident parent or their partner is taken into account in full.

• The reason for the inclusion of tax credits within the maintenance calculation is that if earnings rise, receipt of tax credits reduces accordingly. It therefore seems consistent and fair that the tax credit entitlement, which is a sum derived from earnings, should be included within a non-resident parent’s income for the calculation of child maintenance."

Bluemeanie_2

cakeforbrains wrote: »

The above link says:

"Both working and child tax credits are treated as a non-resident parent’s income as they are paid as a supplement to earnings. In circumstances where the nonresident parent and their partner are working, half of the working tax credits received will be included within the non-resident parent’s net weekly income in order to calculate his or her liability. If the non-resident parent’s partner receives the household primary income, no tax credits will be included as part of the income figure for the purposes of the maintenance calculation. Child tax credits paid to either the non-resident parent or their partner is taken into account in full.

• The reason for the inclusion of tax credits within the maintenance calculation is that if earnings rise, receipt of tax credits reduces accordingly. It therefore seems consistent and fair that the tax credit entitlement, which is a sum derived from earnings, should be included within a non-resident parent’s income for the calculation of child maintenance."

The website and calculator suggest different to this which I find odd. It says, "certain tax credits are taken into account" and then when you put in your info to calculate the amount it only asks for your income including WTC not CTC???

https://www.gov.uk/how-child-maintenance-is-worked-out/how-the-child-support-agency-works-out-child-maintenance