Advice on Housing Benefit while doing a bit of temp work while claiming Working Tax Credits

poppy12345

GeezaJoab said:

All everyone has done is parlay the same information I got from government and council websites - and all anyone has advised me to do is contact the council -

That's because that's exactly what you need to do. You've been receiving earnings, which need to be reported. Not sure what other answers you really need.

Alice_Holt

It's for these type of cases ("I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon"), that Tax Credits brought in the some self-employment tests to prevent the taxpayer subsidising non commercial ventures
:https://revenuebenefits.org.uk/tax-credits/guidance/how-do-tax-credits-work/self-employed/

It's likely that the OP has had information from TC re their responsibilities for claiming Tax Credits, it's also possible that (as with their HB claim - Your HB claim might be stopped or reduced if you do not report a change of circumstances straight away -  including any increase in your income) they may not have attached great weight to understanding and meeting their responsibilities.  To date they have been lucky that TC have not (yet) scrutinised the commercial nature of their self employment status and reclaimed the WTC paid. 

After the OP moves to Universal Credit, this 'gainfully employed' test is applied more rigorously:
 https://www.gov.uk/government/publications/universal-credit-and-self-employment-quick-guide/universal-credit-and-self-employment-quick-guide

Jyana

Very good points Alice. I do wonder with the company conveniently only making profits that bring total income for last year up to just under the £2,500 threshold would give them reason to look into this?

It's been a few years since I was on WTCs myself so I have done a bit of refresher/reading up and came across the below (my bold), and after reading this I would perhaps advice the OP to let HMRC know about this rise in income now too anyway. This would lesson overpayment now, and therefore help them when UC kicks in as the last thing you want at that point is large debt markers being taken off your monthly payments.

"( ...) by law you do not have to tell HMRC about any income changes in-year until your claim is being finalised after the end of the tax year. Because your annual income figure is used in working out your tax credit award, it can be difficult partway through the year to know if your annual income has changed significantly. For instance, you may get a small amount of overtime or reduce your hours temporarily and you cannot tell if and how much your annual income figure is going to be affected. However, if your income does change, you may carry on getting the wrong amount of tax credits if you delay telling HMRC. It is normally a good idea to report income changes as soon as possible. If you do contact HMRC when the changes occur, you reduce the risk of being overpaid"

Emmia

poppy12345 said:

GeezaJoab said:

All everyone has done is parlay the same information I got from government and council websites - and all anyone has advised me to do is contact the council -

That's because that's exactly what you need to do. You've been receiving earnings, which need to be reported. Not sure what other answers you really need.

I think the OP is hoping for an answer where they don't tell the council/ don't have to repay an overpayment... 

Alas!

peteuk

GeezaJoab said:

It's all a bit of a mess and I'm just looking for a bit of advice - firstly though to summarise my current status for clarity:

- I am self-employed and claim Working Tax Credits
- I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon)
- the HMRC are going to write to me to move me over to Universal Credit soon
- I also worked f/t for 4 weeks just before Xmas and earned about £1,500 (paid weekly)
- the HMRC asked me to update my status within 30 days (about 30 days ago) and I looked at it but don't think I have to change anything as I don't consider this work a second job and may not do any more shifts there (I checked all the examples on the website)
- I am in Social Housing and claim full Housing Benefit and Council Tax Reduction (which the local council were harassing me about just before I started work and now I probably have to mess the claim up again)
- I am a UK resident from birth

I hope you dont mind but here’s a full explination - as noted on the first reply you need to declare the raise income to the council. 

- I am self-employed and claim Working Tax Credits -  so you declare your income annually but guidelines state if you earn +-£2500 then you need to report this to HMRC.  You can choose to declare if you wish to avoid any possible overpayment.
- I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon) -  irrelevant to the situation.  Your business has already been assessed hence the WTC and Housing and Council tax benefit, what is important is the extra you've earned. 
- the HMRC are going to write to me to move me over to Universal Credit soon - As your not claiming UC yet this irrelevant everyone who is claiming tax credit will be given the opportunity to move over to UC.  Your choice to claim or not, however your WTC will end at the end of the three month migration period.  UC works on wages during the monthly assessment period.  It works slightly different for those self-employed but youve not asked about that. 
- I also worked f/t for 4 weeks just before Xmas and earned about £1,500 (paid weekly) - this is the important info and what you need to declare. 
- the HMRC asked me to update my status within 30 days (about 30 days ago) and I looked at it but don't think I have to change anything as I don't consider this work a second job and may not do any more shifts there (I checked all the examples on the website) -this is a second job, even if temp.  Even if you dont get paid depending on what you are claiming the rules differ.  
- I am in Social Housing and claim full Housing Benefit and Council Tax Reduction (which the local council were harassing me about just before I started work and now I probably have to mess the claim up again) - if by messing the claim up again you mean declare your Christmas wage then yes you will, but it shouldn’t be that difficult to work out. Does it mean paying more it may be, but you don't know until you've declared your income. 
- I am a UK resident from birth - irrelevant you've been assessed and are entitled to WTC, Housing and CT benefit. Your residency status will not change the advice already given.  

Yes I’m being pedantic but hopefully this covers your specific situation which is as follows 

-Self employed on WTC, full housing benefit and council tax reduction. 
-Took a paid job over Christmas which earned £1500 f/t for 4 weeks. 
-HMRC has asked me to update my status - having looked at the examples I dont consider this work as a second job. 

Answer declare this income to the council and should you wish to avoid possible overpayment of WTC then declare it to HMRC. 

If you wanted advice on UC then you've not asked for it. 

 

GeezaJoab

Alice Holt:
It's for these type of cases ("I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon"), that Tax Credits brought in the some self-employment tests to prevent the taxpayer subsidising non commercial ventures

It's likely that the OP has had information from TC re their responsibilities for claiming Tax Credits, it's also possible that (as with their HB claim - Your HB claim might be stopped or reduced if you do not report a change of circumstances straight away -  including any increase in your income) they may not have attached great weight to understanding and meeting their responsibilities.  To date they have been lucky that TC have not (yet) scrutinised the commercial nature of their self employment status and reclaimed the WTC paid. 

After the OP moves to Universal Credit, this 'gainfully employed' test is applied more rigorously:

Thanks so much for the lack of faith in my integrity - feel free to talk about me in the third person in my thread also

I came here genuinely looking for solid legal financial advice because this is the first chance I've really had to look into sorting this out while my benefits are in the process of going through chaos

I have worked myself to the point of physical and mental exhaustion over the past few weeks since November and I am still stressed and tired - I have also spent the last few years working tirelessly to build some kind of semi-sustainable income from my own hands while suffering bouts of chronic fatigue and other health symptoms - I feel that maybe if I can work and be productive and self-sustaining again if I can choose the hours I work it might not be counter productive to my health - but juggling f/t work on a job that's designed to give me back strain because the surface I have to work on is too low as well as my business has left me rather burnt out and this is me just getting round to sorting this out

I've also been ATOS'd twice in the past so judge me with that and the above in mind

I have informed the relevant people I have to so far and as for the HMRC I'll be talking to them next week anyway about my switch to UC as I want this sorted out BEFORE I do some more p/t employed work - I also need a rest and have things to attend to with my business

The HMRC can look into me if they like - I have all the accounts and receipts to back me up - I might know better what I'm doing on the business side of things though if the job centre hadn't sanctioned me on the day I was supposed to start a 3 month business mentorship scheme? Just a thought

GeezaJoab

peteuk said:

GeezaJoab said:

It's all a bit of a mess and I'm just looking for a bit of advice - firstly though to summarise my current status for clarity:

- I am self-employed and claim Working Tax Credits
- I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon)
- the HMRC are going to write to me to move me over to Universal Credit soon
- I also worked f/t for 4 weeks just before Xmas and earned about £1,500 (paid weekly)
- the HMRC asked me to update my status within 30 days (about 30 days ago) and I looked at it but don't think I have to change anything as I don't consider this work a second job and may not do any more shifts there (I checked all the examples on the website)
- I am in Social Housing and claim full Housing Benefit and Council Tax Reduction (which the local council were harassing me about just before I started work and now I probably have to mess the claim up again)
- I am a UK resident from birth

I hope you dont mind but here’s a full explination - as noted on the first reply you need to declare the raise income to the council. 

- I am self-employed and claim Working Tax Credits -  so you declare your income annually but guidelines state if you earn +-£2500 then you need to report this to HMRC.  You can choose to declare if you wish to avoid any possible overpayment.
- I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon) -  irrelevant to the situation.  Your business has already been assessed hence the WTC and Housing and Council tax benefit, what is important is the extra you've earned. 
- the HMRC are going to write to me to move me over to Universal Credit soon - As your not claiming UC yet this irrelevant everyone who is claiming tax credit will be given the opportunity to move over to UC.  Your choice to claim or not, however your WTC will end at the end of the three month migration period.  UC works on wages during the monthly assessment period.  It works slightly different for those self-employed but youve not asked about that. 
- I also worked f/t for 4 weeks just before Xmas and earned about £1,500 (paid weekly) - this is the important info and what you need to declare. 
- the HMRC asked me to update my status within 30 days (about 30 days ago) and I looked at it but don't think I have to change anything as I don't consider this work a second job and may not do any more shifts there (I checked all the examples on the website) -this is a second job, even if temp.  Even if you dont get paid depending on what you are claiming the rules differ.  
- I am in Social Housing and claim full Housing Benefit and Council Tax Reduction (which the local council were harassing me about just before I started work and now I probably have to mess the claim up again) - if by messing the claim up again you mean declare your Christmas wage then yes you will, but it shouldn’t be that difficult to work out. Does it mean paying more it may be, but you don't know until you've declared your income. 
- I am a UK resident from birth - irrelevant you've been assessed and are entitled to WTC, Housing and CT benefit. Your residency status will not change the advice already given.  

Yes I’m being pedantic but hopefully this covers your specific situation which is as follows 

-Self employed on WTC, full housing benefit and council tax reduction. 
-Took a paid job over Christmas which earned £1500 f/t for 4 weeks. 
-HMRC has asked me to update my status - having looked at the examples I dont consider this work as a second job. 

Answer declare this income to the council and should you wish to avoid possible overpayment of WTC then declare it to HMRC. 

If you wanted advice on UC then you've not asked for it. 

 

Cheers - some useful pointers

Feel free to volunteers some advice on UC - I was looking for some of that too

I'll be speaking to the HMRC next week

Alice_Holt

GeezaJoab said:

Alice Holt:
It's for these type of cases ("I run my own business f/t and have not yet earned a yearly profit from it (but this year I might make a small profit no more than £1,000 I'd reckon"), that Tax Credits brought in the some self-employment tests to prevent the taxpayer subsidising non commercial ventures

It's likely that the OP has had information from TC re their responsibilities for claiming Tax Credits, it's also possible that (as with their HB claim - Your HB claim might be stopped or reduced if you do not report a change of circumstances straight away -  including any increase in your income) they may not have attached great weight to understanding and meeting their responsibilities.  To date they have been lucky that TC have not (yet) scrutinised the commercial nature of their self employment status and reclaimed the WTC paid. 

After the OP moves to Universal Credit, this 'gainfully employed' test is applied more rigorously:

I have worked myself to the point of physical and mental exhaustion over the past few weeks since November and I am still stressed and tired - I have also spent the last few years working tirelessly to build some kind of semi-sustainable income from my own hands while suffering bouts of chronic fatigue and other health symptoms - I feel that maybe if I can work and be productive and self-sustaining again if I can choose the hours I work it might not be counter productive to my health - but juggling f/t work on a job that's designed to give me back strain because the surface I have to work on is too low as well as my business has left me rather burnt out and this is me just getting round to sorting this out

I've also been ATOS'd twice in the past so judge me with that and the above in mind

I have informed the relevant people I have to so far and as for the HMRC I'll be talking to them next week anyway about my switch to UC as I want this sorted out BEFORE I do some more p/t employed work - I also need a rest and have things to attend to with my business

The HMRC can look into me if they like - I have all the accounts and receipts to back me up - I might know better what I'm doing on the business side of things though if the job centre hadn't sanctioned me on the day I was supposed to start a 3 month business mentorship scheme? Just a thought

       If you are suffering from ill health (either physically or mentally) then I'd suggest you look at eligibility for PIP. 
this could also increase a WTC award and reduce the hours you are expected to work re your WTC claim.


      You mention ATOS  - is this in relation to an ESA claim ?   If so, look at this to see if you could already qualify for the disability element of WTC
https://revenuebenefits.org.uk/tax-credits/guidance/how-do-tax-credits-work/understanding-disability/

   I'd be wary of jumping from WTC to UC without taking the managed migration route (i.e before being invited to apply by the DWP), as this will stop you benefiting from any transitional protection.
UC & self-employment are not a happy mix - be aware that UC assume a base level of profit from SE cliamants, regardless of actual profit:
https://www.citizensadvice.org.uk/benefits/universal-credit/on-universal-credit/how-universal-credit-payments-work-if-youre-self-employed/

  If you are suffering from ill health when you are invited to claim UC - then get a doctors note and request a Work Capability Assessment:
  https://www.citizensadvice.org.uk/benefits/universal-credit/if-youre-sick-or-disabled/getting-universal-credit-if-youre-sick-or-disabled/
If assessed as unfit for work, then the Minimum Income Floor is not applied.

I'd suggest you get some advice on your exact situation from your local advice charity. 
However, you will need to be more open and less aggressive to any advice given than in your responses here.  Unfortunately, you come across as unfriendly and adversarial. If this is not intentional, but due to ill-health I would suggest you mention this in your posts (however the advice to inform your council of your additional earnings for HB (and CTr) purposes remains crucial and is central to your situation).    
It's as (if not more) important than telling HMRC, as HB is calculated on a weekly basis whereas TC are calculated annually (and has a £2,500 disregard).  By not informing HB, you will now have an overpayment and will need to agree a repayment plan.   

Edit   Actually it's more important that you tell HB of your increased income than TC's.  If your LA find out about your wages before you tell them (info is shared between LA/ HMRC / DWP), they are likely to suspend your HB claim.  

GeezaJoab

I'm happy to pay rent in arrears - I have budgeted for this - I feel that I have sort of made that clear already - I'm not going to blow all the money I earned before I know how much I will have to pay 

I'm here for advice on my finances to find out if maybe I can possibly.. save some money - and there is nothing unethical about that when it comes to dealing with this government - as far as I am concerned everyone should withhold tax and stop complying with this corrupt, fascist government of occupation but the reality is we all have to survive so most folk (myself included) just try their best to navigate their way through the red tape

And many thanks for the pointers - genuinely Alice Holt I gleaned one useful pointer from your reply - but also I refute your negative assertions on my character - another instance of your slightly rude tone

How anyone is supposed to make sense of the rules of claiming benefits and income tax etc these days is beyond me - they have clearly deliberately designed the system this way to gaslight us into thinking they're on our side

All the rest Alice but seriously - did you not read that I have been "ATOS'd" twice - I have already gone through two work capability assessments and they clearly have no interest in listening to people when they say they are struggling to cope - I resolved some health issues last year anyway and so I am trying to find p/t work doing something 3 days a week and if this and my continued self-employment don't mix with UC then who cares as long as I can pay my rent and bills and have a little left over to buy food and essentials

And as for asking my local advice charity, well what do you think I am doing here - is this not an "advice charity"?

marcia_

GeezaJoab said:

I'm happy to pay rent in arrears - I have budgeted for this - I feel that I have sort of made that clear already - I'm not going to blow all the money I earned before I know how much I will have to pay 

I'm here for advice on my finances to find out if maybe I can possibly.. save some money - and there is nothing unethical about that when it comes to dealing with this government - as far as I am concerned everyone should withhold tax and stop complying with this corrupt, fascist government of occupation but the reality is we all have to survive so most folk (myself included) just try their best to navigate their way through the red tape

And many thanks for the pointers - genuinely Alice Holt I gleaned one useful pointer from your reply - but also I refute your negative assertions on my character - another instance of your slightly rude tone

How anyone is supposed to make sense of the rules of claiming benefits and income tax etc these days is beyond me - they have clearly deliberately designed the system this way to gaslight us into thinking they're on our side

All the rest Alice but seriously - did you not read that I have been "ATOS'd" twice - I have already gone through two work capability assessments and they clearly have no interest in listening to people when they say they are struggling to cope - I resolved some health issues last year anyway and so I am trying to find p/t work doing something 3 days a week and if this and my continued self-employment don't mix with UC then who cares as long as I can pay my rent and bills and have a little left over to buy food and essentials

And as for asking my local advice charity, well what do you think I am doing here - is this not an "advice charity"?

 No actually it's not. 

 This is a free public forum where anyone can post or give advice. Some people are more knowledgeable than others having worked or volunteered in advice services. Others can get their information from government websites. Which I note you already say you have but choose to disbelieve it coming here perhaps on finding a way round government rules.