Tax Credits

Borgie

Hope somebody can advise me.

I currently work full time and earn 16.5k - I get approx 160pw tax credits, working tax and child tax.

I would lke to reduce my hours to 22.5 and would earn 9.5k.

Will I have to wait a whole year before my tax credits increase as tax credits are based on previous years earnings?

Thanks x

[Deleted User]

No, you should inform TCO straight away that your current year income and hours are decreasing.
You must be warned though, if you earn anything above the estimate you give them, you will be overpaid. It is probably best to add a thousand or two on top of your estimate in case you get a pay rise or do some overtime.
If you earn less than your estimate, you will be paid back the underpayment of tax credits at the end of this fiancial year (Next April) when you complete your annual declaration.

Borgie

subsoniccoyote wrote: »

No, you should inform TCO straight away that your current year income and hours are decreasing.
You must be warned though, if you earn anything above the estimate you give them, you will be overpaid. It is probably best to add a thousand or two on top of your estimate in case you get a pay rise or do some overtime.
If you earn less than your estimate, you will be paid back the underpayment of tax credits at the end of this fiancial year (Next April) when you complete your annual declaration.

Thanks for that. Will my tax credits increase as soon as my earnings decrease then? I am worried as I can't afford to drop my income if my tax credits don't increase but at the moment working full time I am having to leave my children on their own too much and it isn't working out.

They are 14 and 13 and I put them into holiday schemes when I can find one that will take them at that age but there are not many available.

[Deleted User]

They should re-calculate your award straight away and you should hopefully see an increase within a week or so. Until your renewal is completed you may not receive an amended award notice so if you call up to give the changes then call bak again 3/4 days later to check how the change has affected your award.