Don't understand my tax credit muddle

frogga

Afternoon All,

I've got into a right muddle about my Tax credits as they keep telling me different things. Just wondered if any of you could shed some light on my problem.

My husband and I both work (me part time/ term time) have two children 11 and 12 and have claimed tax credits for ages.

My husband was Self Employed for 6 years. THis meant that as he did badly one year, the following years Tax Credits were high as they based our award on what we earnt in the previous year.

4 years ago work really picked up and I knew we were going to end up owing some back as the estimate would have been right out. THey refused to stop paying us and insisted that we were collecting what we were entitled to.

Then low and behold we ended up owing thousands :rolleyes:

We have had no payments all of the last Tax Year while we are paying back what we owe. THey estimated that 07/08 we would earn £27000 but it was actually £21000. Even with this wrong estimate ajusted we still owe £1200 acording to them.

They have now told me that they will pay us £190 a month this year based on us earning £21000.

I have just changed my job and this year will be earning £14000 while my husband who is now not S/E any more will earn £25000. That's a household income of £39000.

If they are paying us £190 a month based on estimated figures of £21000 it's gonna be WAY out and we'll end up owing money back AGAIN!!!

On the phone JUST NOW the man said as long as our income doesn't go £25000 MORE than the £21000 estimate we'd be entitled to the £190.

That cant be right can it? DO you think it's right that if we earn £21000 or £39000 our entitlement is the same? Surely not?

I would rather they kept the money and waited til the end of April 09 and then pay me a lump sum if they owe me , but they wont do it that way.

One last moan, each time I phone they say I owe a different amount. It has varied between £500 and £2500

Any expert knowledge would be appriciated :T

Thanks in advance x

toniwoty2009

hi frogga
me again!
got no expert knowledge on tax credits but wanted to add my twopenneth! i've had similar situations every year with the t/c people. they actually accepted my appeal last year on it. they worked out my t/c based on my income (as i was on maternity leave it was looooooooow) even though i'd told them i would be earning more that year. on the form they send out they'd even put 'you told us that this year you expect to earn X' but still worked it out based on previous figures. upshot is i appealed, they said basically said ok our bad and that was that. my advice would be check your forms stating what you are entitled to VERY carefully.
on the left hand inside page (bottom i think) will say what you earnt last tax year and top right hand page will say what you've told them you expect to earn, if you have told them you expect to earn more they should be working on those figures and you should be able to appeal

HTH, if you want any more help PM me.

hotblu

frogga wrote: »

Afternoon All,

I've got into a right muddle about my Tax credits as they keep telling me different things. Just wondered if any of you could shed some light on my problem.

My husband and I both work (me part time/ term time) have two children 11 and 12 and have claimed tax credits for ages.

My husband was Self Employed for 6 years. THis meant that as he did badly one year, the following years Tax Credits were high as they based our award on what we earnt in the previous year.

4 years ago work really picked up and I knew we were going to end up owing some back as the estimate would have been right out. THey refused to stop paying us and insisted that we were collecting what we were entitled to.

Then low and behold we ended up owing thousands :rolleyes:

We have had no payments all of the last Tax Year while we are paying back what we owe. THey estimated that 07/08 we would earn £27000 but it was actually £21000. Even with this wrong estimate ajusted we still owe £1200 acording to them.

They have now told me that they will pay us £190 a month this year based on us earning £21000.

I have just changed my job and this year will be earning £14000 while my husband who is now not S/E any more will earn £25000. That's a household income of £39000.

If they are paying us £190 a month based on estimated figures of £21000 it's gonna be WAY out and we'll end up owing money back AGAIN!!!

On the phone JUST NOW the man said as long as our income doesn't go £25000 MORE than the £21000 estimate we'd be entitled to the £190.

That cant be right can it? DO you think it's right that if we earn £21000 or £39000 our entitlement is the same? Surely not?

I would rather they kept the money and waited til the end of April 09 and then pay me a lump sum if they owe me , but they wont do it that way.

One last moan, each time I phone they say I owe a different amount. It has varied between £500 and £2500

Any expert knowledge would be appriciated :T

Thanks in advance x

Hello,

Have you done you renewal for 07/08 and confirmed your actual income as £21,000? If so then that figure will be used to calulate your cy entitlement. You can call up and re-estimate your cy income to £39,000, but it will still be based on py income. You have been advised correctly. The income disregard announced in the budget for TC purposes is £25,000, which means aslong as you dont earn more than £46,000 (£21,000 + £25,000) you wont be overpaid. However, next years entitlement will go down as it will then be based on £39,000 (that's why it's important to re estimate now so your provisional payments next year are correct). Hope this makes sense and haven't confused you too much.

Regards,

Hotblu

frogga

That's EXACTLY what she told me on the phone, so they were right. It seems unbelievable as in previous years our awards changed if our earnings varied more than £2500, now it's £25000!! Thanks guys I do get it now :rolleyes: and HI toni , see you on the other thread later