Correct info regards CSA2 and Tax Credits !

DAREDEVIL78

hi members, I am wanting someone to confirm my query, I pay maintenance to an ex using the csa2 system.


I am married with 2 kids in our marital home, my payment is based on my wage only and doesn't take into account my wifes wage.


my confusion arises with the csa using our tax credit payments, we receive both working & child tax credits that is paid into my bank account but my wife is the named recipient on the correspondence letters.


I appreciate that credits are to supplement income and could also understand the use of working tax credit as this is solely related to earnings, but the use of child tax credits for children in our household I find wrong.


so is it correct (more so to use) child tax credits in calculating csa payments ?


I find the issue a very grey area with some technicalities not answered.


1- even if you focus on the working tax credit only , how can the full amount be used by csa , they cant and do not use my wifes wage yet can use the working credits which is paid as a result of both our incomes, surely they could only use a percentage of the working tax credit payment.


2-i feel really strongly that child tax credits are used , we only get them because of the children in our household !!! and once again the credit payment is calculated from both wages therefore the full amount shouldn't be used, but still I feel if at all !


3- do the csa take any tax credits into account simply because I receive them into my bank account yet my wife is named as the recipient, what if the money went into her bank account, would that change anything ?


lastly , I have always paid for my non resident childs upkeep and see her regular but feel there is something unfair when it comes to tax credits being used to calculate a csa payment, its too vague and I have questioned the csa about credits being used but half the time I feel the csa bluff their way through claims hoping that the non resident parents knowledge is poor so therefore they cant try and use any nrp's monetary income or benefit and hope to get away with it, even if they know they possibly couldn't.


sorry the thread is long


thoughts/replies gratefully received !

clearingout

It is correct - your Tax Credit claim is a joint one and takes into account both your incomes and as such, part of the tax credit is yours. Won't make a difference if paid into your wife's account.

Children in your care are taken into account in your CSA calculation - is this the case? It should say in the paperwork but you can phone to check it.

Yes, it's unfair. It's also unfair that the PWC's maintenance can be reduced as a result of children that don't belong to the NRP. Swings and roundabouts. Imperfect system which no one is happy with!

shoe*diva79

I agree, its unfair to use tax credits for one child to give to another who will be receiving tax credits in their own right. However, swings and roundabouts as your first set of children will have a reduced amount of CM due to you having more kids with new wife. So kinda not fair that they miss out because you have more kids.

Caz3121

DAREDEVIL78 wrote: »

1- even if you focus on the working tax credit only , how can the full amount be used by csa , they cant and do not use my wifes wage yet can use the working credits which is paid as a result of both our incomes, surely they could only use a percentage of the working tax credit payment.

The way they calculate the CSA element of working tax credits is based on who is the higher earner. If your wife was the higher earner then the WTC would be classed as hers and not included. If you are the higher earner then they are classed as yours.


2-i feel really strongly that child tax credits are used , we only get them because of the children in our household !!! and once again the credit payment is calculated from both wages therefore the full amount shouldn't be used, but still I feel if at all !

You should have 20% of your income excluded before the CSA calculation is made due to having 2 children in your household.

I agree with you that it seems unfair to include the CTC but if they exclude that they should not allow a discount for having children in your home - in some cases they should cancel each other out