Tax credit income

MABLE

A friend of mine who is claiming working tax credit would like know if when he comes to renew would he need to tell me about £300 he has received in cash backs payments by changing bank accounts.

He knows about more than £300 in interest payments have to be declared but thought the £300 cash backs would be part of his income.

Darksparkle

MABLE wrote: »

A friend of mine who is claiming working tax credit would like know if when he comes to renew would he need to tell me about £300 he has received in cash backs payments by changing bank accounts

Why would he need to tell you about any cash back received?

Or did you actually mean them?

To be honest, never heard of anyone declaring cash back so I doubt it's included.

HappyMJ

You do not need to declare cash back incentives.

zagfles

Depends - cashback on credit cards etc definitely don't need to be declared as they're like a discount on a purchase, but on current accounts it's a bit more vague. For instance the Halifax Reward account, the monthly reward is taxable so that would need to be declared, but I don't think the switch reward of £125 is.

MABLE

To answer my question I rang the Tax credit help line who were very helpful.
They confirmed you would not need to "declare the cash back for switching bank accounts as it would be deemed as a gift".

However not sure if same applies if you are on PAYE.

MABLE

According to my friends personal tax account HMRC have is estimated earnings at £13075 for 2016/17. This apparently has increased because of his yearly bonus. The tax credits were originally given an estimated income by him as £12,976. Should he update his figures with them again for this year or leave it until next year based on these figures are all estimates.

Also he is a single working man with no dependants.

Darksparkle

He should always notify them of any changes.