wtc overpayment £408

candygirl

Pam17 wrote: »

http://www.hmrc.gov.uk/manuals/tctmanual/TCTM05200.htm

About halfway down under Changes in income

It applies to both WTC and CTC.

Thanks Pam now , i can see it now and have saved it in my favourites to refer to when i contact them.:p

donnalove

If you ring tc during the year at anytime to notify a change you lose the disregard, so if your income then goes above what you have said you will have an overpayment.

donnalove
xx

susieb1967

donnalove wrote: »

If you ring tc during the year at anytime to notify a change you lose the disregard, so if your income then goes above what you have said you will have an overpayment.

donnalove
xx

Hi, sorry to be a bit thick here!- but does this mean for e.g. that say my wages go up £5000 ( I wish!) and i inform them then this will be disregarded and i will still get the same tax credit and not have to pay anything back but if I DON'T tell them I will have to pay the overpayment back? How does this work with self employment when you don't know till the end of the year how much you have earned?

System

donnalove wrote: »

If you ring tc during the year at anytime to notify a change you lose the disregard, so if your income then goes above what you have said you will have an overpayment.
xx

The important sentences from the link I gave above are:

"There is no need for a claimant to notify a change if he expects his income for the year to 5th April 2007 to be no more than £25,000 higher than his income for the year to 5th April 2006. It will make no difference to the amount of tax credit he will receive for the current year although the increased income will be taken into account in the following year"


So don't tell them of your income increase until the renewal time at the end of the year unless you think your income is going to increase by more than £25,000.

You still need to tell them of other changes such change in hours worked, child leaving school and household breakdown.

System

susieb1967 wrote: »

Hi, sorry to be a bit thick here!- but does this mean for e.g. that say my wages go up £5000 ( I wish!) and i inform them then this will be disregarded and i will still get the same tax credit and not have to pay anything back but if I DON'T tell them I will have to pay the overpayment back? How does this work with self employment when you don't know till the end of the year how much you have earned?

No what donnalove was saying was:-

If you call and tell them your income will increase by £5000 you lose the right for your income to increase by another £20,000 (in that tax year) and be disregarded. So if your income actually increases by £7000 they will disregard the £5000 (because you have previously reported it) and you will have an overpayment due to an increase of £2000 (£7000 - £5000).

I'm not 100% sure this is true and would advise anyone anyhow to carefully check their award notices everytime they do report a change in circumstances.

If you don't tell them, per the information on the HMRC link, then at the end of the year any increase up to £25000 will be disregarded so there will be no overpayment. But your new increased income will then be used as the estimate for the new tax year and you will see a significant reduction in your payments.

nats3006

They are just a nuisance that tax credits!!!