Tax-Free Childcare, but have breached 100k

sparksmith

Hello,

My partner earned ~95k for financial year 23-24 (a bit more as it is variable due to on-call additional payments). 

We rent out a property with a join ownership and have earned a little over 10k (after repairs and other deductions) . 

For the period of time we expected that he will not earn more than 100k and have claimed tax-free childcare.

We now started filling out the self assessment and it turns out he is over with 700GBP. I called Tax-Free Childcare on the phone and they couldn't help and just stated there is not much they can do about the previous year. I called a free tax-advisor and they suggested after filling out the Self-Assessment to fill out an HMRC disclosure. 

Regarding 24-25 financial we know he will not breach 100k because he has made a substancial salary sacrifice which brings him well below the threshold.

- Is there something we need to do regarding that for the previous year we claimed he will not breach but he did breach the 100k in regards to the tax-free childcare 
- is there anything we need to be worried about because of that breach last year regarding the claim for this year. 

Thank you. 

More_complicated_than_that

sparksmith said:

Hello,

My partner earned ~95k for financial year 23-24 (a bit more as it is variable due to on-call additional payments). 

We rent out a property with a join ownership and have earned a little over 10k (after repairs and other deductions) . 

For the period of time we expected that he will not earn more than 100k and have claimed tax-free childcare.

We now started filling out the self assessment and it turns out he is over with 700GBP. I called Tax-Free Childcare on the phone and they couldn't help and just stated there is not much they can do about the previous year. I called a free tax-advisor and they suggested after filling out the Self-Assessment to fill out an HMRC disclosure. 

Regarding 24-25 financial we know he will not breach 100k because he has made a substancial salary sacrifice which brings him well below the threshold.

- Is there something we need to do regarding that for the previous year we claimed he will not breach but he did breach the 100k in regards to the tax-free childcare 
- is there anything we need to be worried about because of that breach last year regarding the claim for this year. 

Thank you. 

Your partner can make a gift aid contribution, do a self-assessment tax return for 2023/24 after the gift aid payment to elect to treat the gift aid payment as if it was made in 2023/24.

MetaPhysical

MakeMore_complicated_than_that said:

sparksmith said:

Hello,

My partner earned ~95k for financial year 23-24 (a bit more as it is variable due to on-call additional payments). 

We rent out a property with a join ownership and have earned a little over 10k (after repairs and other deductions) . 

For the period of time we expected that he will not earn more than 100k and have claimed tax-free childcare.

We now started filling out the self assessment and it turns out he is over with 700GBP. I called Tax-Free Childcare on the phone and they couldn't help and just stated there is not much they can do about the previous year. I called a free tax-advisor and they suggested after filling out the Self-Assessment to fill out an HMRC disclosure. 

Regarding 24-25 financial we know he will not breach 100k because he has made a substancial salary sacrifice which brings him well below the threshold.

- Is there something we need to do regarding that for the previous year we claimed he will not breach but he did breach the 100k in regards to the tax-free childcare 
- is there anything we need to be worried about because of that breach last year regarding the claim for this year. 

Thank you. 

Your partner can make a gift aid contribution, do a self-assessment tax return for 2023/24 after the gift aid payment to elect to treat the gift aid payment as if it was made in 2023/24.

IS it possible to retrospectively do that (if I understand what you said properly)?  I thought the gift aid payment to do that must have been made before 5th April 2024 ?

Dazed_and_C0nfused

MetaPhysical said:

MakeMore_complicated_than_that said:

sparksmith said:

Hello,

My partner earned ~95k for financial year 23-24 (a bit more as it is variable due to on-call additional payments). 

We rent out a property with a join ownership and have earned a little over 10k (after repairs and other deductions) . 

For the period of time we expected that he will not earn more than 100k and have claimed tax-free childcare.

We now started filling out the self assessment and it turns out he is over with 700GBP. I called Tax-Free Childcare on the phone and they couldn't help and just stated there is not much they can do about the previous year. I called a free tax-advisor and they suggested after filling out the Self-Assessment to fill out an HMRC disclosure. 

Regarding 24-25 financial we know he will not breach 100k because he has made a substancial salary sacrifice which brings him well below the threshold.

- Is there something we need to do regarding that for the previous year we claimed he will not breach but he did breach the 100k in regards to the tax-free childcare 
- is there anything we need to be worried about because of that breach last year regarding the claim for this year. 

Thank you. 

Your partner can make a gift aid contribution, do a self-assessment tax return for 2023/24 after the gift aid payment to elect to treat the gift aid payment as if it was made in 2023/24.

IS it possible to retrospectively do that (if I understand what you said properly)?  I thought the gift aid payment to do that must have been made before 5th April 2024 ?

You can do it but you have to include it on a Self Assessment return (no other method seems to apply) and it must be the first return you file.

You cannot include it on an amended return.  

Well you can do but HMRC are known to pick up on that and open an investigation and disallow the carry back.

More_complicated_than_that

MetaPhysical said:

MakeMore_complicated_than_that said:

sparksmith said:

Hello,

My partner earned ~95k for financial year 23-24 (a bit more as it is variable due to on-call additional payments). 

We rent out a property with a join ownership and have earned a little over 10k (after repairs and other deductions) . 

For the period of time we expected that he will not earn more than 100k and have claimed tax-free childcare.

We now started filling out the self assessment and it turns out he is over with 700GBP. I called Tax-Free Childcare on the phone and they couldn't help and just stated there is not much they can do about the previous year. I called a free tax-advisor and they suggested after filling out the Self-Assessment to fill out an HMRC disclosure. 

Regarding 24-25 financial we know he will not breach 100k because he has made a substancial salary sacrifice which brings him well below the threshold.

- Is there something we need to do regarding that for the previous year we claimed he will not breach but he did breach the 100k in regards to the tax-free childcare 
- is there anything we need to be worried about because of that breach last year regarding the claim for this year. 

Thank you. 

Your partner can make a gift aid contribution, do a self-assessment tax return for 2023/24 after the gift aid payment to elect to treat the gift aid payment as if it was made in 2023/24.

IS it possible to retrospectively do that (if I understand what you said properly)?  I thought the gift aid payment to do that must have been made before 5th April 2024 ?

As long as you do the gift aid contributions before you submit the tax return that's fine.  You have to enter the details in Box 7 on page TR4 of your tax return.