Benefit cuts timetable

henlans

andrewmp wrote: »

Nah, that's not right. You lose a percentage of the full amount for every £1 you earn above £3850 (currently £6kish).

I think its 40%

henlans

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/416330/47881_Budget_2015_Web_Accessible.pdf

Miroslav

andrewmp wrote: »

Nah, that's not right. You lose a percentage of the full amount for every £1 you earn above £3850 (currently £6kish).

My current award is around £3600.

So If I earn £4100 over the new threshold and say it's 40% i'd lose over £1600.

It's still going to hurt as I do just get by as it is.

It's going to hurt a lot of people unfortunately.

Stella_Artois

henlans wrote: »

Basically its worked out after £6,420 then after that you lose £1 per £1 you earn (I thought it was 40% and not 100%)


so from 2016 it will be from £3,850

Thanks very much for the explanation

Mersey_2

Treasury Minister David Gauke MP said no current claimants will be affected. It's for new claimants from 2017. Although I think he was just referring to the 2 child limit.


But the detail of all Budgets tends to take a few days to all come out.

bloolagoon

Miroslav wrote: »

My current award is around £3600.

So If I earn £4100 over the new threshold and say it's 40% i'd lose over £1600.

It's still going to hurt as I do just get by as it is.

It's going to hurt a lot of people unfortunately.

The disability premiums still apply so not too much reduction - at least what I've read. You will lose the 41% after your premium due to disability

henlans

http://www.telegraph.co.uk/finance/personalfinance/how-budget-affect-me/11721785/Budget-2015-what-to-expect-for-income-tax-and-the-personal-allowance.html


You will be -£2056.20 worse off

devon_guy

The easiest way to work out your new tax credit entitlement is as follows...

Your earnings - £3,850 X 41% (tax credit withdrawal rate).

That figure you then deduct from the maximum tax credits you are entitled to gives you the amount you will receive.

So assume I am a single person with a disability working 21hrs a week earning 8,500 per year. The maximum WTC I can receive is 1,940 (basic element)+2,935 (disability element)=4,875
Using the current threshold of 6,420 I would be entitled as follows..

8,500-6420=2080
2,080*41%=832
4,875-832=4043 Which would be my current tax credit award.

Under the new regs I would be entitled to the following...
8,500-3,850(new threshold)=4,650
4650*41%=1860
4,875-1860=3015

Therefore come the new threshold, I would be over £1,000 a year worse off than this year. A lot to lose!

Casual_Bystander

No mention of making carers allowance means tested? Think i'm ok then
My 4yr old receives DLA mid rate, I receive CBx2, CA, CTC+disabled child component. Don't think anything will change for me?

Cas

SkyeKnight

devon_guy wrote: »

The easiest way to work out your new tax credit entitlement is as follows...

Your earnings - £3,850 X 41% (tax credit withdrawal rate).

That figure you then deduct from the maximum tax credits you are entitled to gives you the amount you will receive.

So assume I am a single person with a disability working 21hrs a week earning 8,500 per year. The maximum WTC I can receive is 1,940 (basic element)+2,935 (disability element)=4,875
Using the current threshold of 6,420 I would be entitled as follows..

8,500-6420=2080
2,080*41%=832
4,875-832=4043 Which would be my current tax credit award.

Under the new regs I would be entitled to the following...
8,500-3,850(new threshold)=4,650
4650*41%=1860
4,875-1860=3015

Therefore come the new threshold, I would be over £1,000 a year worse off than this year. A lot to lose!

It's worse than that I'm afraid because the withdrawal rate is going up from 41% to 48%, so you need to multiply by 0.48 rather than 0.41.