Tax credits stopping altogether if I start work??

Katnira

I posted yesterday but I'm panicking as I've just done the online benefit calculator again after being offered a job today and I'm being shown my tax credits will stop.

I've been a carer for my disabled children for the last 10 years, receiving Income Support, Carers Allowance and Child Tax Credits.

My wage will be £11k pa for 30hrs a week. No pension. The benefit calculator says because my income is more than 5k above what I earned last year, my tax credits will stop altogether.

Is this right?

If so, there's no way I can afford to work as I'll be losing my tax credits but increasing my costs - child care, petrol, school dinners, full council tax.

Please help. I need to give an answer on the job today. Thanks.

zagfles

No it's complete rubbish. Which calculator did you use? Either the calculator is rubbish or you've entered the figures wrong. You'd not only get CTC in full but some WTC as well. Try the turn2us one http://www.turn2us.org.uk/benefits_search.aspx

Brighty

Or the tax credit calculator
http://taxcredits.hmrc.gov.uk/Qualify/DIQHousehold.aspx


Just lie to it and fill in as if you've been in your new job a year.


Note that the result at the end is the amount you will receive for the rest of this tax year, so 11 months, not what you get per year, a lot of people seem to miss that


Brighty

Katnira

I used Entitled To.

Maybe I got confused as I listed my Carers as income. I'm so confused now. I will try Turn2us. Thanks.

Katnira

Ah Brighty, I think that's what I did differently this morning. Previously I had 'lied' to it as you say and put in figures like I had been working for a year. This morning, I just put in my Carers as last years earnings and it frightened me to death!

Brighty

Just a thought
Is your Carers allowance ending for a reason, or just because of the new job?
If you want to stop getting carers voluntarily and return to work, then good for you, but, IF you wanted to, not saying you should, but IF, you got the/a new job for 16hrs a week instead of 30hrs, the 16hrs means you'd still get the WTC, but doing 16hrs instead of 30 would see your income drop from £11k to £5.7k or so, which means you could possible just squeeze in under the £110 a week average needed to still get carers, so you'd get a wage + CTC + WTC + CA. You'd end up not much worse off money wise, with less childcare costs and still get your council tax discount etc. Could also save you on travel costs if you did the 16hrs by working fewer days You'd just need to make sure you never earned more than £5720 a year (52wks x £110) to keep eligible for carers.


Brighty

Brighty

Actually, you could probably earn more than £5720 as you can deduct child care costs from your earnings for carers allowance eligibility


"How are your earnings calculated for Carer's Allowance?
Only your own earnings are counted. If you have a partner who works their earnings are ignored.
In calculating your earnings, the Carer's Allowance Unit can make certain deductions from your gross earnings. This includes not only any tax and national insurance you pay but also other deductions for:

• alternative care costs you have, for example if you are paying someone to look after your child whilst you are working. There is a cap on the maximum amount that can be deducted in this way - this is half of what would otherwise be your earnings. There is no requirement that the childcarer is a registered childcare provider. Costs can be be deducted so long as you pay someone other than a close relative
• 50 per cent of any pension contributions that you make into a work or personal pension scheme
• an amount for any expenses you have that are 'wholly, exclusively and necessarily incurred' in carrying out your work. For example if you have to buy equipment or specialist clothing or have to pay for travel between workplaces (travel between work and home does not count)."

Brighty

Katnira

The CA would stop just because of the hours. I did look into working 16 hours but the rate they pay would put me a pound or 2 over the £110 limit and ideally they want someone 30 hours a week. From my calculations I'll not be substantially better off working 30 hours instead of 16 but I'm hoping that it will eventually go to 37.5 hours p/w and give me a steady job for the future (fingers crossed).

ETA: childcare is not going to be from a registered provider. It's a family friend And the job offers no pension.

Thanks again for your input. Appreciated.

Brighty

No problem, glad to help


note from my previous post re: childcare costs for carers allowance purposes (not the case fro tax credits though)


"There is no requirement that the childcarer is a registered childcare provider. Costs can be be deducted so long as you pay someone other than a close relative"