How do you work out hours for tax credit purposes?

Charityworker

Just wondered if anyone has any idea how you do this. I run an events business. I'm taking calls, emails, Facebook messages etc all day literally from 9am to 10pm. Plus visiting clients, putting up posters, writing press releases, drawing up floor plans. So when working out time spent on phonecalls and emails etc do I put 5 minutes here, 10 minutes there and add them up or do I put that I was on call from 9am to 10pm? For instance I was in the supermarket the other day when I received a business call so I put my basket down and got my diary out for 5 minutes. So do I just put that I did 5 minutes work or say I was on call all day?

pmlindyloo

Can you give a bit more information?

Am not sure why you are having to provide this detailed information to claim tax credits?

Are you trying to prove a certain number of hours?

Charityworker

I haven't been asked to prove my hours. I've seen posts saying as of 6th april self employed people will have to prove their hours so I thought I'd start keeping track of what I do incase they ask me.

Freshstart2012

Hi
I think it has always been the case that at some point you may have to prove your hours of work if you are self employed.
I had a compliance check a few years ago and spent a whole weekend preparing the evidence that HMRC asked for, which was my own fault as I didn't keep good enough records. I did pass the check and thanks to HMRC I now record everything that I do within my business.
I set up an excel spreadsheet sheet and basically recorded all of my activities under different headings, ie office work, visiting clients etc. I recorded daily and at the end of each week ran a total. I also kept a list of all of my customer appointments.
It is a bit of a pain but worth it should you ever receive a compliance check in the post.

I was actually wondering if the new rule regarding the minimum wage starts from April, in that if you work 16/30 hours then you have to earn 16/30 x £6.50 to qualify for WTC or is that just a rumour.

Icequeen99

Freshstart2012 wrote: »

Hi
I think it has always been the case that at some point you may have to prove your hours of work if you are self employed.
I had a compliance check a few years ago and spent a whole weekend preparing the evidence that HMRC asked for, which was my own fault as I didn't keep good enough records. I did pass the check and thanks to HMRC I now record everything that I do within my business.
I set up an excel spreadsheet sheet and basically recorded all of my activities under different headings, ie office work, visiting clients etc. I recorded daily and at the end of each week ran a total. I also kept a list of all of my customer appointments.
It is a bit of a pain but worth it should you ever receive a compliance check in the post.

I was actually wondering if the new rule regarding the minimum wage starts from April, in that if you work 16/30 hours then you have to earn 16/30 x £6.50 to qualify for WTC or is that just a rumour.

No, the new rule is that your business has to be carried on a commercial basis with a view to the realisation of profit. It must also be organised and regular.

IQ

Freshstart2012

Icequeen99 wrote: »

No, the new rule is that your business has to be carried on a commercial basis with a view to the realisation of profit. It must also be organised and regular.

IQ

Ah right thanks for that.

Charityworker

Ok I shall start keeping a diary of what I do and totting up the time each week. I am in a profitable business so I think I should be fine. I only get £10 per week WTC anyway so it would be no biggy if I lost it.

Charityworker

Ok so after a bit of research and a phonecall to the tax credits I have come to the following conclusion. If I had an office to run my business from where I went there at 9am and came home at 5pm and only did my work during that time I would be able to put down all those hours as work. Regardless of whether I was actually doing anything or sitting there twiddling my thumbs. However because I work from home and I am contactable all the time, including weekends, bank holidays etc I can't say I'm on call all that time. I have to work out how much time I spend on each task and add it up. Even though I'm doing the same amount of work I would be doing if I had an office. Hardly fair!

NYM

Charityworker wrote: »

Ok so after a bit of research and a phonecall to the tax credits I have come to the following conclusion. If I had an office to run my business from where I went there at 9am and came home at 5pm and only did my work during that time I would be able to put down all those hours as work. Regardless of whether I was actually doing anything or sitting there twiddling my thumbs. However because I work from home and I am contactable all the time, including weekends, bank holidays etc I can't say I'm on call all that time. I have to work out how much time I spend on each task and add it up. Even though I'm doing the same amount of work I would be doing if I had an office. Hardly fair!

Being available/on call isn't remunerative.

Maybe you need to weigh up what you have to do to prove your claim against losing the £10 a week.

Is it worth it ?

Icequeen99

Charityworker wrote: »

Ok so after a bit of research and a phonecall to the tax credits I have come to the following conclusion. If I had an office to run my business from where I went there at 9am and came home at 5pm and only did my work during that time I would be able to put down all those hours as work. Regardless of whether I was actually doing anything or sitting there twiddling my thumbs. However because I work from home and I am contactable all the time, including weekends, bank holidays etc I can't say I'm on call all that time. I have to work out how much time I spend on each task and add it up. Even though I'm doing the same amount of work I would be doing if I had an office. Hardly fair!

The rules are in effect the same though. The person sat at their desk twiddling their thumbs from 9 to 5 is getting paid for each hour. So you are doing your tasks at lots of different times over the day, so you need to add up the hours where you are working for payment or in expectation of payment.

It would be the same for someone on call in an employed job. If you are an on-call worker, you can only claim for the hours you are called out and not those you areon call.

IQ

Charityworker

Icequeen99 wrote: »

The rules are in effect the same though. The person sat at their desk twiddling their thumbs from 9 to 5 is getting paid for each hour.
IQ

Not if it was my own office for my own business I wouldnt. I'd still be getting what I'm getting now but still only doing the same amount of work.

This proves my point that if I worked from 9 to 5 in an office I could say I'm doing more hours than if you work from home. Not that I will do that but do you see what I mean?