The affects of overtime on benefits?

n1guy

So currently I work 40 hours per week, I received both Tax Credits and Housing Benefits.

I'm pretty sure Tax Credits allows a small buffer and because its based on previous years earnings nothing would be affected until the next tax year.

Housing Benefits is a different beast in that if I did overtime this week (paid weekly) my housing benefits would drop by the same amount next week.

So it would mean overtime is a pointless exercise? No? Obviously yes I'd be supporting myself rather than from the state pot but my employer is looking me to go to Ireland for a couple of weeks which will involve a fair bit of overtime and I can't see the point of all that effort if I'm not going to be any better off financially.

Robbie64

You do need to report your extra earnings to HB. If doing overtime was a regular thing then HB can average out your earnings over a period of time but if it's an irregular thing then working extra hours and earning extra income will affect HB plus any Council Tax Support you may also get.

seashore22

Look at it this way, perhaps doing some overtime and being seen as a hard worker who will get the job done would be a good thing long term. Perhaps that will lead to better prospects in the future and you won't have to rely on benefits at all.

takman

If your working 40 hours a week then you can't be getting much Housing Benefit and Tax Credits unless your on a really low wage. So doing lots of overtime may reduce these to zero for a bit but then you will be getting extra pay above that which is all yours to keep?.

pmlindyloo

Earnings mean your HB will reduce by 65p for every £1 so you will be 'better off'.

tboo

n1guy wrote: »

So currently I work 40 hours per week, I received both Tax Credits and Housing Benefits.

I'm pretty sure Tax Credits allows a small buffer and because its based on previous years earnings nothing would be affected until the next tax year.

Housing Benefits is a different beast in that if I did overtime this week (paid weekly) my housing benefits would drop by the same amount next week.

So it would mean overtime is a pointless exercise? No? Obviously yes I'd be supporting myself rather than from the state pot but my employer is looking me to go to Ireland for a couple of weeks which will involve a fair bit of overtime and I can't see the point of all that effort if I'm not going to be any better off financially.

If you work extra then you pay more tax and NI which is deducted off the assessment.
You then pay 65p in the £1 for any extra earnings (not £1 for £1).
Put your potential income for this period into entitled to

seashore22

This thread looks very different to the way it did a few hours ago.

The op has deleted some posts?

n1guy

seashore22 wrote: »

This thread looks very different to the way it did a few hours ago.

The op has deleted some posts?

Nothing to do with me.

Robbie64

takman wrote: »

If your working 40 hours a week then you can't be getting much Housing Benefit and Tax Credits unless your on a really low wage. So doing lots of overtime may reduce these to zero for a bit but then you will be getting extra pay above that which is all yours to keep?.

The problem there is that if the OP lives in a full service area (not a live service area) for Universal Credit then it won't be possible to reclaim Housing Benefit if HB stops because of income. Instead in future the OP would have to claim Universal Credit and this will then cause his or her Tax Credits to stop.

Over the next few months more and more people are going to be affected by this and will find that UC is not as generous as Tax Credits and Housing Benefit combined. At the moment I don't think many people are aware that this could happen.

But yes, it is better to try and up his or her hours and try as much as possible to get off benefit as the OP will then keep, after tax and NI, every penny of what they earn rather than looking at extra wages reducing any benefit entitlement.

n1guy

That's a good point. I never thought about UC which is currently rolling out around here. I definitely don't want to end up on that. I'd have to make about £200 extra per week to get clear of benefits, never gonna happen, that's almost an entire weeks wage.

So the £20-30 extra per week would do nothing but screw me up.

BorisThomson

n1guy wrote: »

That's a good point. I never thought about UC which is currently rolling out around here. I definitely don't want to end up on that. I'd have to make about £200 extra per week to get clear of benefits, never gonna happen, that's almost an entire weeks wage.

So the £20-30 extra per week would do nothing but screw me up.

Why is it never going to happen, what are you doing to improve your prospects?