Confused about child tax and childcare costs calculation

Sarahjane_Nanglo

Hello, I have recently received a tax credit award but I'm confused about the calculation. I'd really appreciate any advice from anyone out there. I have two kids (ages 6 and 2). My 6 year old uses breakfast and after school Ofsted registered clubs. My two year old goes to a full time registered Ofsted nursery. Our Joint salary is £42000.

1. Working tax credit element awarded £4600
Reduction due to your income £4600
Amount for the period

---

£ 0

2. Total Child Tax Credit element £5993
Reduction due to your income £5993

---

Amount for the period £ 0

What I don't understand is why is there a 'reduction due to my income' in both points 1 and 2 above?

If all the above figures are correct can we claim childcare costs which per week for both kids is £250. If so, then how much can we claim please? The HMRC online calculator says we can claim £3861 based on the dates 28/7/13-5/4/14 but on the tax credit award notice it says the childcare costs element is £0 !! Many, many thanks for any advice.

bossymoo

Assuming its £250 for all 52 wks that is 13,000 pa or 9,100 claim (70% of costs).

Did you tell them your childcare costs?

Generally, they deduct 41p from your award for every £ over the threshold that you earn (threshold is about £6400 I think).

So if your working tax is £4600, childcare £9100 and child tax £5993 (total £19,693) then they will deduct
£42,000 - £6,400 = £35,600 x 41% which is £14,596

So you should get around £5k

Unless - your childcare costs were already factored in there, or are term time only etc.

Did you declare your childcare costs?

Icequeen99

Edited until OP adds more info!
IQ

Icequeen99

blondebubbles wrote: »

Doesnt sound like your childcare has been included on the claim.

Check your award and see how much childcare is showing and how many children are showing as in childcare.

She posted from her award notice above. They have included over £5000 of the childcare element. My post explains why she looks like she is getting Nil - it is just she is getting more CTC support.

IQ

Icequeen99

blondebubbles wrote: »

The OP says the CTC is NIL and the CC element:

2. Total Child Tax Credit element £5993
Reduction due to your income £5993

---

Amount for the period £ 0

That would make me think she was getting nothing at all

Having re-read it I think the OP needs to clarify.

She says CTC is nil, but also then later in the post says that childcare element is also shown as Nil. It wouldn't show the childcare element at all if it wasn't included - sounds to me she is saying after reduction due to income it is nil?

OP - how much childcare are you currently claiming on your award notice? And are you getting any payments at all of child tax credit?

IQ

notanewuser

Can somebody with a household income of £42k and 2 kids really get tax credits for childcare?!

Icequeen99

notanewuser wrote: »

Can somebody with a household income of £42k and 2 kids really get tax credits for childcare?!

yes.

IQ