Tax free childcare & 30 hours

fragilecliche

Hi,

Last tax year (2021/2022) I cashed in a policy which was gifted to me to buy a house. The policy was subject to tax and took me over the £100,000 threshold. I had to pay my child benefit back in the tax return but wasn't sure what to do with my tax free childcare account, which I also lost out on due to the threshold. I completley understand the guidance surrounding that and agree on missing out if earning over £100k, so please don't think I'm complaining about this bit, I'm just wanting to seek some clarification as it's really impacted us financially. 

I only found out this amount was subjext to tax after last financial year had ended, so in my account had been starting that my income would not exceed £100k, as my only other income is my salary which was £16.5k.  When realising it would impact my tax account I called the tax free childcare and asked them what I needed to do as it was in the last financial year and I didn't want to have claimed wrongly and/or wanted to pay back what I  owed. They said they'd be in touch if they needed, but could see it was an unusual one off payment and it was unlikely they would ask for it back, but that they would make a note on the system that I'd called.

Fast forward to today, I've heard nothing about last financial year, but have had a message to my account stating that they are going to stop my tax free childcare and reduce my 30 free hours to the standard 15 as they expect me to earn over £100k this year. I absolutely won't this financial year, as it was a one off gift, which has all been paid into a house. Can I just ask, where do I stand with asking for a mandatory review? Given it was in the last financial year and my earnings will be well under £100k this year (again, just my £16.5k salary) am I still entitled to it this financial year? I'm really worried as need my 30 free hours to work. I had accounted for what we owed them back last year (which was just the tax free allowance - my daughter has since turned 3) and have kept that money in a 'just in case' pot as didn't entirely believe I wouldn't need to pay it back, but now my daughter is entitled to the full 30 free hours, this is going to have massive impact on us financially.

Thanks! 

sheramber

Why not contact them and advise you won't earn over £100k this coming year?

Icequeen1

My understanding is that the test for TFC applied at the point you do your eligibility confirmation every 3 months. It isn't a retrospective test so it doesn't matter what your actual income turned out to be, it matters what you reasonably expected it to be when you completed those statements. So i think you may have to appeal if they won't accept your latest declaration. 

fragilecliche

Thanks both. I did the mandatory review and they have reinstated it. It was really straight forward in the end