Wtc

Bryando

Hi,

My partner has an active Working Tax Credit claim with steady hours. I have secured two zero hour contracts. How do I update HMRC with this as my hours differ weekly/ monthly? Do I just report online each month what I have done? Have not got a clue with this!

Caz3121

tax credits work on an annual income for the tax year, initially based on the previous years income. You call and give an estimate of what you expect the revised annual figure to be for this year so they can adjust the award. If you underestimate you may have an overpayment that will require to be repaid, if you overestimate you may end up with an underpayment that you will be paid when the award is finalised.

Darksparkle

Bryando wrote: »

Hi,

My partner has an active Working Tax Credit claim with steady hours.

I assume you mean a joint claim?

Bryando

Yeah. Just updated the system online. Declared my hours worked for last week. Would it be better just to try and work out what my annual income will be to try and avoid an overpayment? Rather be underpaid than over! Even if means changing it monthly!

Darksparkle

Bryando wrote: »

Yeah. Just updated the system online. Declared my hours worked for last week. Would it be better just to try and work out what my annual income will be to try and avoid an overpayment? Rather be underpaid than over! Even if means changing it monthly!

Tax credits don't take weekly or monthly incomes. They want an estimate for your income for this tax year. It is better to overestimate.

Bryando

Yeah that is what I meant changing the estimated yearly income.

Tolly_T

It can take them quite a while to update your award based on a change of estimated yearly income. It does make sense to keep an eye on it but I wonder if you could do the calculation yourself. If you were able to work out what the overpayment was each month and put it in a savings account you'd not be in a situation at year end where you were worrying about an overpayment. You'd have it ready to repay if they wanted it in a lump sum or you could live off it if they took it off your award next year.

This could be done quite simply using the annual estimate you provided them with to calculate a weekly or monthly estimate and then if ever you earn over this put the difference in the savings account. This wouldn't be accurate, you'd always be saving more than you needed but you wouldn't be worrying about it. Alternatively, you could do a more accurate calculation on a spreadsheet comparing year to date figures for your estimate and actual figures.