HB, Tax Creds, CB etc being cut as child 16...

Hi everyone,

I wondered if anyone could have a look at the following information as my neighbour is really concerned.....

1. Sarah aged 50 works 16 hours per week as a self-employed cleaner, she earns £96 and gets Child & Working Tax Creds totalling £136 per week, total income £232.

2. Daughter Holly has just turned 16 and just finished Yr 11, she has secured & started an apprenticeship at a local salon paying £2.70 per hour - Sarah will lose her Child Benefit - in Sept Holly will be doing a 'day-release' to a college an hour each way by bus (we are in a rural area). College or salon won't help with bus fare as it's not classed as a 'college course', even tho Sarah & Holly are both on low incomes - is this right?

3. With such a low income, will Holly pay any tax?

4. If she doesn't pay any tax, does this mean that she can't claim any help for the uniform she has to buy and any dry cleaning? So from her £2.70 p.h she has to pay her bus fare, uniform upkeep and probably her tools of the trade?

5. Sarah's rent on her 3 bed HA house is currently £115 (son recently left home, so she will be stung for the bedroom tax), housing benefit give her £12 per week so she pays £103. With Holly working she has been told her HB will stop, this means that Sarah's weekly income of £232 will be minus £115 rent leaving £117 per week for food and other bills - this doesn't seem much to live on being rural as petrol itself is sky high.

6. Sarah has been told by Tax Creds that as Holly isn't returning to full time education in Sept, she (Sarah) has to find 30 hours min work per week or she will lose her Tax/Child Creds - is this right? Was working 16 hours per week only allowed due to having a child in school?

7. My husband left me after 18 yrs August last yr and he had been my carer for 5 yrs after cancer left me disabled. Sarah stepped up and has been helping me clean my house, dinners, washing, ironing, shopping etc all this time. We did not claim Carer's Allowance as she was told this would be another income and would affect her Tax Creds; £53 per week could not compete with £136 per week.

If Sarah has to find another 16 hrs work a week she won't be able to still give me the 34 odd hours she does for me, this again will leave me up the creek without the energy to paddle. IF we claimed for Carer's and she got the £53 per week, would Tax Creds accept this as her extra hours and add her weekly wage of £96 to Carer's as her total weekly income?

Would Tax Creds kick-in again if she continues her 16 self-employed hours plus caring for me?

It doesn't seem right that a young person leaving school and earning pittance can have an effect on her mum's household income to the extent that child benefit, housing benefit, child tax creds and tax creds will all stop and she will have less money to live on than before - UNLESS Sarah can find an extra 16 hrs of cleaning work, which would start the tax creds again but leave me without a carer.

We would both really appreciate some advice :)

Thank you....Lisa

Replies

  • princessdonprincessdon Forumite
    6.9K Posts
    Ok

    She's no longer a lone parent, so needs to work 30 hours for tax credits, she can claim carers but you could lose some of your benefits. Caring isn't counted.

    It's a hard one with apprenticeships - I think they should be classed as study, but they aren't, she's now a working adult and all child benefits stop.
  • Are you saying that this neighbour works for you for 34 hours per week and you pay her nothing?
  • JobseeekerJobseeeker Forumite
    433 Posts
    Hang on, you (or Sarah) are confusing yourself with the "bedroom tax"

    There is no such thing, it is a reduction in housing benefit, as Sarah is no longer receiving housing benefit, it won't affect her. Don't worry, there is no "tax" to pay on top of her rent.

    3. you don't say how many hours Holly is working but 4 days a week £2.70 unlikely that she could earn over the threshold. So no she won't pay income tax
  • edited 31 July 2013 at 4:09PM
    nannytone_2nannytone_2 Forumite
    12.8K Posts
    Tenth Anniversary 10,000 Posts Combo Breaker
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    edited 31 July 2013 at 4:09PM
    Jobseeeker wrote: »
    Hang on, you (or Sarah) are confusing yourself with the "bedroom tax"

    There is no such thing, it is a reduction in housing benefit, as Sarah is no longer receiving housing benefit, it won't affect her. Don't worry, there is no "tax" to pay on top of her rent.

    3. you don't say how many hours Holly is working but 4 days a week £2.70 unlikely that she could earn over the threshold. So no she won't pay income tax

    ALL THAT IS STOPPING HER ENTITLEMENT TO hb IS THE LOSS OF A CHILD PREMIUM, SO ONCE HER CHILD RELATED BENEFITS (CHILD TAX CREDITS AMD CHILD BENEFIT) STOP SHE WILL HAVE AN INCOME LOW ENOUGH FOR MOST OF HER RENT TO BE PAID... SO SHE WILL BE AFFECTED BY THE REDUCTION IN HOUSING BENEFIT.... OR DO YOU SERIOUSLY THINK THAT THE £96 SHE RECEIVES FROM HER SELF EMPLOYMENT WOULD BE HER ONLY INCOME?

    NO WTC OR CHILD RELATED BENEFITS, BUT hb ISNT DEPENDANT ON RECEIVING OTHER BENEFITS .... JUST A LOW INCOME
  • Caz3121Caz3121 Forumite
    14.7K Posts
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    She can still claim housing benefit, as her working and child tax credits will stop her only income will be her earnings. Her £12 per week is likely to increase as her income will have decreased. I don't believe there is a non-dependent deduction for 16 year old apprentices
  • letthemeatcakeletthemeatcake Forumite
    219 Posts
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    Carers counts as income for tax credit purposes but doesn't mean she would be any worse off.
  • Perhaps it's just me but how can anyone allow a neighbour to work 35 hours for them for £100 CA, much less for nothing?

    OP, why don't you pay her for 14 hours' work at NMW mainly out of your DLA and so allow her to claim tax credits. The present situation seems to me to be unsustainable and bordering on the immoral.
  • toomuchinfotoomuchinfo Forumite
    125 Posts
    Carers can still get WTC if they are only working 16 hours.
    If she claims Carers Allowance you might lose some of your means tested benefit, so check this first.
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