Tax credits help please

Sinisterzane

Hi all,

I am banging my head off the wall a bit here...I have phoned up the tax credits people 3 times getting them to use there calculators and have been given 3 different values I may be entitled to..£97.00 pw, £0.00 pw and £110.00 pw..using the same figures!

Ok so here is our situation

My gross for the 2012-2013 tax year will be around £33,000 (they allow a 5,000 discrepency aparently) I am yet to do my tax return for 2012-2013 and am currently working on the figures for my accountant. But I can see my labour top line (after materials deducted) as 33K...there will be lots of otherr outgoings to be taken into consideration when the return is actually done but can safely say it wont be more than 33K gross and will probably be a lot less.

In September 2012 I lost the main contract I was working on for 6 years and going from the 7/11/12 - 7/11/13 I can see my labour rate (after materials deducted) as £8300 (terrible)

My wife is classed as disabled.
She has been on incapacity benefit since 1994...this incapacity benefit has changed to employment support allowance as of January of this year but the benefit is aparently the same.
She recieves £44.00 DLA a week of which is the lower component
Her ESA is £110.00 per week rising to £120.00 per week at some point during this month.

They are saying if the incapacity (ESA) benefit was claimed before 13th April 2005 this can be taken out of the calculation....

The DLA isnt taken into consideration.

As of the last person I spoke to they say I am entitles to £110.00 per week!!

Does this seem correct to you?

Thanks in advance

Poppie68

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Icequeen99

Firstly the info you have on incapacity benefit/ESA is incorrect. Incapacity benefit was ignored for tax credits for people who had been getting it since before April 1995. However, when the person is changed from IB to ESA the ESA, if contribution based, will be counted in full as income as it is taxable.

You don't really give enough detail for us to check the calculations.

What is your 13/14 estimated income?

What figure are you actually entering in the calculator for 12/13?

Do you have children? Childcare costs?

IQ

Sinisterzane

Icequeen99 wrote: »

Firstly the info you have on incapacity benefit/ESA is incorrect. Incapacity benefit was ignored for tax credits for people who had been getting it since before April 1995. However, when the person is changed from IB to ESA the ESA, if contribution based, will be counted in full as income as it is taxable.

You don't really give enough detail for us to check the calculations.

What is your 13/14 estimated income?

What figure are you actually entering in the calculator for 12/13?

Do you have children? Childcare costs?

IQ

Hello and thanks for the reply...

The ESA my wife recieves is contribution based

33,000 is my 2012 - 2013 return

8200 is my projection for 2013 - 2014

We have no children or childcare costs

I am having trouble understanding the "disability" element of working tax credits for my wife..The people ive been talking to on the phone have been automatically ticking the box due to her being on the lower rate of DLA...however the definition of the disability entitlement as im reading it means she has to be working in some way and claiming DLA?

Most confusing

Thanks

Sinisterzane

Ok...

I have just been on the phone to them for the fourth time...

They are saying I am entitled to £62.00 per week as they take her ESA into consideration as its contributions based (phoned them and checked) she was on incapacity benefit from 11/3/1994 of which wasnt means tested but now they have switched people from incapacity benefit (as of 2/1/13) to contributions based ESA of which makes it means tested....

I need to get this spot on as I dont fancy being skinned alive a year down the line due to be overpayed......

The reason the amount is high is due to the £8200.00 I am projecting as the 2013-2014 tax year and the "disability" part

As im reading this disability part on the HMRC wesbite working tax credits calculator it says...

You or your partner are classed as disabled for tax credits purposes if all of the three conditions below apply:

Condition 1: You usually work for 16 hours or more a week

Condition 2: You have a disability that puts you at a disadvantage in getting a job

This could be a physical disability, visual or hearing impairment, or other disability such as a mental illness. Some examples are:

• when standing you can't keep your balance unless you continually hold onto something
• you can't walk a continuous distance of 100 metres along level ground without stopping or without suffering severe pain - even when you use your usual walking aid
• you cannot use either of your hands behind your back, as if you were putting on a jacket or tucking a shirt into trousers
• you are registered as blind or partially sighted
• you cannot hear a phone ring when you are in the same room as the phone, even if you are using your usual hearing aid
• you have a mental illness that you receive regular treatment for under the supervision of a medically qualified person.

Condition 3: You're receiving, or have recently received, a qualifying sickness or disability-related benefit or credit

For example, you might currently be getting:

• Disability Living Allowance
• Personal Independence Payment.

Examples of benefits or credits you could recently have been getting are:

• Employment and Support Allowance
• Council Tax Benefit or Housing Benefit with a Disability Premium or Higher Pensioner Premium
• National Insurance credits because you have limited capability for work.

Also answer 'yes' to this question if you or your partner get any of the following:

• the Highest Rate Care Component of Disability Living Allowance
• the Higher Rate of Attendance Allowance
• the Enhanced Daily Living Component of Personal Independence Payment.

If you're not sure how to answer, or your illness or disability isn’t covered above, you can call the Tax Credit Helpline for advice on Tel 0345 300 3900 or Textphone 0345 300 3909.

So at first glance where it says about working for 16 hours or more a week this looks like she wouldnt be classed as disabled for tax credits purposes as she is unable to work..but the latest guy on the phone is ADAMANT that rule applies for a single claim basis and I can class her as disabled in my joint application due to me working 30+ hours a week and her being on disability living allowance (DLA isnt included in the income calclulation).

So the figures are as follows

Me 2012-2013 tax year £33,000
Me 2013-2014 projected tax year £8200

Wife ECA £6284.20 for both years (actually goes up from £110.85 to £120.85 per week as of 17/11/13 but I am arriving at that £6284.20 figure by using the £120.85 per week x 52 weeks)

She is classed as disabled (still not sure about this part)

Does this make sense?

Thanks

Icequeen99

Sinisterzane wrote: »

Hello and thanks for the reply...

The ESA my wife recieves is contribution based

33,000 is my 2012 - 2013 return

8200 is my projection for 2013 - 2014

We have no children or childcare costs

I am having trouble understanding the "disability" element of working tax credits for my wife..The people ive been talking to on the phone have been automatically ticking the box due to her being on the lower rate of DLA...however the definition of the disability entitlement as im reading it means she has to be working in some way and claiming DLA?

Most confusing

Thanks

So you need to add your wife's ESA to your figures as it is taxable and therefore income for tax credits.

You will not qualify for the disability element of tax credits, and when you fill in the actual claim form you must not tick the box about disability. In fact you won't declare your wife's disability at all as it isn't relevant to your claim and DLA isn't classed as income, it would only be relevant if she received the higher rate care component which would entitle you to the severe disability premium (which doesn't require the disabled person to work).

Once you add in your wife's ESA, you may not qualify for anything because there is a 2,500 disregard for falls income. So if your figure for 13/14 is estimated at 8,200 and your wife's IB is around £6000 that is income of 14,200 and then add the disregard means they will treat your income as 16,700 roughly.That would only get a few hundred entitlement for the year.

If your 8,200 turns out to be too low, then you are likely to be overpaid.

You would be entitled to more in 14/15 if your income stayed the same.

All of this presumes you continue to work at least 30 hours a week.

IQ

Icequeen99

Our posts crossed. HMRC are wrong - you are NOT entitled to the disability element.

To get the disability element you have to meet 3 conditions that you listed. Your wife does not because she doesn't work. It is the person working who must have the disability.

The only element you could qualify for is the severe disability element. But your wife isn't getting the right level of DLA for that.

IQ

Sinisterzane

Thanks Icequeen

Im wondering why these people dont seem to know there rear end from there elbow!..I mean are they dealing in one area do you think i.e answering calls all day about tax credits or a range of benefits? Surely if they just dealing with tax credits you would think they might know what they are on about!

I also get the impression the DWP dont record phone conversations..perhaps this is why they can talk such nonsense..I had the same routine earlier this morning when asking when my wife started to claim Incapacity. I had to phone 3 times until I got someone who knew how to use the computer and look back a long way into her history...


I suppose sub consiously due to the range of people they are dealing with day in day out they dont give a monkeys and perhaps regard the claimants as scroungers..that and they are probably being paid a pitance, being put under pressure by there "superiors" and dont want to do they job they are in...

Icequeen99

Sinisterzane wrote: »

Thanks Icequeen

Im wondering why these people dont seem to know there rear end from there elbow!..I mean are they dealing in one area do you think i.e answering calls all day about tax credits or a range of benefits? Surely if they just dealing with tax credits you would think they might know what they are on about!

I also get the impression the DWP dont record phone conversations..perhaps this is why they can talk such nonsense..I had the same routine earlier this morning when asking when my wife started to claim Incapacity. I had to phone 3 times until I got someone who knew how to use the computer and look back a long way into her history...


I suppose sub consiously due to the range of people they are dealing with day in day out they dont give a monkeys and perhaps regard the claimants as scroungers..that and they are probably being paid a pitance, being put under pressure by there "superiors" and dont want to do they job they are in...

Quite simply the majority of the tax credits helpline staff are not well trained in tax credits and use guidance on their screen following call type processes. There are some operators who are more experienced but rare these days. Calls to the tax credits helpline are recorded.

Having looked at HMRC's material on this issue, they would do well to stress the person working must be the person with the disability (for the disability element).

IQ