Tax credits and SMP?

squashy

Totally confused.

I have just started maternity leave and I am only entitled to SMP, so 90% wages for 6 weeks then 33 weeks at the standard rate of £112

So I need to report changes in my income. However looking at it I will have THREE changes in circumstances in the space of a month!

1. My income dropping to 90%
2. The baby being born
3. My income dropping to £112

So do I wait until all three have happened or ring them each time?

I rang them a couple of months ago and they weren't so helpful, they told me to work out what my earnings will be for the whole of this tax year and they will recalculate my weekly amount, however I have no idea how I will do this. I have had one wage slip which is for a half-and-half period so I have no idea how much the weekly amount exactly is IYKWIM. I am still going to be paying pension contricutions too which complicates it more. My salary is term time only but spread equally over 12 months.

I just don't know where to start in terms of working out what I will get for the year.

I notice there is no calculator on the TC website any more so I am really worried about how much money we are going to have coming in, especially if it takes them a while to increase my TCs accordingly, we are going to be really struggling.

I am the main earner in my household too as my husband can only work part time due to a chronic condition (although cannot get any extra in terms of DLA for this etc). When I think that tax and NI get knocked off the £112 per week to we are going to be scarily poor

alwaysonthego_2

With smp I believe that you deduct £100 per week of it which does not count as income for tax credits iykwim and the rest of it the £12 is classed as income. So when totalling your annual income make sure you deduct the £100 per week off it. What you need to do is work out roughly how much your husband gets and add it to what you are getting and that should be what you tell tax credits, though make sure it is the gross amount and not net

http://www.hmrc.gov.uk/forms/tc600-notes.pdf
page 37

squashy

I rang them today and they basically told me to guess and then any adjustments can be made NEXT year after my P45 confirms the figures. So I am going to have to go through my payslips and see what I can figure out. Hope I don't get it wrong though.

Oh and the other thing- they only allow you to deduct the £100 per week of maternity pay for the first 26 weeks, despite being on SMP for 39 weeks- !!!!!! is that all about???

And they wonder why it is a fiasco- too much depends on the layman being able to number crunch and then it all comes crashing down when you get it wrong...

clareo122

sorry bumping this up as I'm now confused.
I've just done my renewal and been told its the final figure for the yr doesn't mater about any SMP- where last yr I was asked how many weeks I was on SMP for!! and we rang a few weeks ago enquiring about the fact in Sept I will go back to just SMP and was told to ring them when this happens but now I'm being told I can't it doesn't matter till the end of the 9 months leave ARGH what is the real thing I've not had £100 taken off for each week I was on SMP this last tax yr
have rules changed

kurjam

i am confused now, so you can only take £100 off for 26 weeks,
even if you take 39 weeks maternity leave....

do you take it of the 90% leave and the £112 leave ??
thanks

fi_trix29

Just to clarify things a little (I am a TC advisor):

It may seem unhelpful but we just dont have a place to put a weekly income figure, what we need is a total for the tax year - we are very reluctant to help you work it out because if we work out an estimate that is too low you can be overpaid then would obviously put in a complaint that we had worked it out wrong and then we would have to face disciplinary action and it would go on our employee records which clearly we don't want. It is not our job to tell you how much you will earn for the year, you need to tell us that, we simply record what you tell us. The best place to get an estimate of your earnings for the year is your payroll dept - they have all the info on how much you have been paid so far, how much you will be getting on the 90% and how much you will be getting of SMP.

The £100 disregard - this applies for the full time you are on paid maternity leave up to a maximum of 39 weeks, however you can only deduct it from the tax year it applies to so it may be that some of the weeks are in one tax year and the rest are in the next.

When working out an estimate for this year, get the estimate of what your P60 will read from your payroll dept then get a callendar out and find out how many weeks of paid maternity fall in that tax year. Deduct 100 x that number of weeks from your estimated p60 figure to get the figure to give TC. **I ALSO STRONGLY RECCOMEND ROUNDING THIS UP TO PREVENT ANY OVERPAYMENTS**