Working tax credits??

[STEVE HANLEY]

Wasn't sure where to put this. So money matters seemed good enough.

Does anyone on here claim these? Against being self employed as a dj/disco business? If that makes sense:confused:

Was just wondering if anyone knew about these things and what it all entailed.

Any help or advice greatly appreciated good people.:beer1:

[Solitaire Events Ltd]

http://taxcredits.hmrc.gov.uk/Qualify/WhatAreTaxCredits.aspx

Have a read of that Steve. You can then fill a few questions in to see if you qualify.

[DazzyD]

Hi Steve

I work in local authority benefits and encounter Tax Credits on a daily basis although I am by no means an expert. However, if you want to know anything specific just ask and I'll help the best I can.

Generally, though, my advice is always to make a claim and see if you're entitled - at the very worst they send you a letter saying sorry. At best, you get extra cash which can, perhaps, be backdated so you could get a nice little surprise!

My site of choice for info is:

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/TaxCredits/index.htm

[sxboy]

Wasn't sure where to put this. So money matters seemed good enough.

Does anyone on here claim these? Against being self employed as a dj/disco business? If that makes sense:confused:

Was just wondering if anyone knew about these things and what it all entailed.

Any help or advice greatly appreciated good people.:beer1:

Yeah I claim this, I used to get FAMILY tax credits as well, but as the "kids" are no longer kids,that has stopped, but still get the working one. As others have said, just put a claim in or give them a call, I know you here alot of horror stories about tax credits, like people being overpaid and having to pay back loads etc, but I have never had a problem, if you keep the informed of you circunstances it's fine.

Daren

[djtrev]

I know you here alot of horror stories about tax credits, like people being overpaid and having to pay back loads etc, but I have never had a problem, if you keep the informed of you circunstances it's fine.

Daren

Not my experience I am afraid.
Having claimed for whatever benefits I was entitled to and been assessed on our yearly income,when it came to the end of the year and our income had increased from the previous year (which your benefits are based on) we were then told that we were paid too much so we had to pay the overpayments back.
Now if its a considerable sum some people will find it difficult to pay so they assess you again on the income for the current year and take a percentage out each week to recover the over payment from the previous year.
IT seems to me that come the end of the next financial year if your income has increased again you are in the same boat again ie you have been overpaid on your benefits so you owe them money ,again.



Now I may be playing the system wrong(I sure someone will soon tell me) but I grudge paying them the overpayment in a lump sum out of my account so I am happy for them to take it out of the money they pay us each month.

[DazzyD]

Not my experience I am afraid.
Having claimed for whatever benefits I was entitled to and been assessed on our yearly income,when it came to the end of the year and our income had increased from the previous year (which your benefits are based on) we were then told that we were paid too much so we had to pay the overpayments back.
Now if its a considerable sum some people will find it difficult to pay so they assess you again on the income for the current year and take a percentage out each week to recover the over payment from the previous year.
IT seems to me that come the end of the next financial year if your income has increased again you are in the same boat again ie you have been overpaid on your benefits so you owe them money ,again.



Now I may be playing the system wrong(I sure someone will soon tell me) but I grudge paying them the overpayment in a lump sum out of my account so I am happy for them to take it out of the money they pay us each month.

I can confirm that this scenario is very common, actually, and it's all down to the way you are assessed for Tax Credits. Your income is assessed using your last financial years income (so for 2011 to 2012 they use your income from 2010 to 2011) and then your claim for the last year is reviewed around June/July. As many peoples income increases year on year, then the overpayment problem occurs. However, HMRC will allow you put aside any overpayments until later if you tell them that the resulting reduced Tax Credits award will cause you financial hardship (although I wouldn't recommend "playing" on this as any overpayments will just mount up and you'll end up paying more back).

My concerns with Tax Credits is that the system is open to fraud due to the practically non-existent verification used by HMRC when checking what you've told them. They tend to just believe what people tell them until Annual Review time, and, only then seek proof is something seems very unusual. Also, I've seen cases where people have told HMRC that their circumstances have changed or their income has increased and the changes will result in a lower Tax Credits award but HMRC have refused to amend their claims there and then thus knowingly create an overpayment. They've sent out letters basically saying "Thanks for telling us about this. We're doing nothing with your claim now and we will keep paying you the same and you can pay us back later." which, personally, I think is crazy but hey-ho! Anyway, there's big changes on the horizon!! ;)

[Vectis]

On the flip side, when I left full time employ in December 2008 I put in a tax credits application simply to cover all bases (and, because my lad was under 19 and in full-time education I was entitled to a proportion of the family element in any case). But, because they based the claim on fiscal 2007-2008 my entitlement was 0.

In summer 2009 my income had recovered above the tax credits threshold and my lad had finished his college course when a cheque arrived for a couple of hundred quid from HMRC. No letter, nothing. So a phone call later and it transpired that the letter was in a backlog but in essence it was a tax credits underpayment because once I'd filed 2008-2009 earnings it validated my earlier claim.

:daft:

So the moral of this tale is that it will all sort itself out in the end.

I'd suggest that if you find yourself in the "knowingly receiving too much" camp that you park the excess in a savings account for the inevitable claw back *BUT* don't let this stop you applying!

[STEVE HANLEY]

Thanks for the replies so far chaps. It was the link that Darren (Solitaire) posted that prompted this thread.

Without looking again. I got about half way through it when it asks you to put down an expected/required income. That was what stumped me as I didn't have a clue what to put.

So hence meeting with accountant on Tuesday am so I can try and come to a figure with his help. I think:daft: :D :D

[DazzyD]

On the flip side, when I left full time employ in December 2008 I put in a tax credits application simply to cover all bases (and, because my lad was under 19 and in full-time education I was entitled to a proportion of the family element in any case). But, because they based the claim on fiscal 2007-2008 my entitlement was 0.

In summer 2009 my income had recovered above the tax credits threshold and my lad had finished his college course when a cheque arrived for a couple of hundred quid from HMRC. No letter, nothing. So a phone call later and it transpired that the letter was in a backlog but in essence it was a tax credits underpayment because once I'd filed 2008-2009 earnings it validated my earlier claim.

:daft:

So the moral of this tale is that it will all sort itself out in the end.

I'd suggest that if you find yourself in the "knowingly receiving too much" camp that you park the excess in a savings account for the inevitable claw back *BUT* don't let this stop you applying!

Tax Credits always pay you before they send the letter out. When I first applied, I did it online on a Sunday afternoon (not possible now as they found that people realised you could easily make fraudulent claims online so they closed that method applying). My now-ex went to get her Child Benefit from the bank on the following Thursday and found nearly an extra £1,000 in the bank. She wouldn't touch it as she didn't know what it was for. The award letter came on the Saturday. And this system continued through our experience of Tax Credits!

As for the increased Tax Credits, I found that year after year they always seemed to overestimate my earnings which resulted in an average of £300 being paid in to my account in July after the Annual Review. It always came in handy at summer holiday time!!

And, as I said before, I always advise people to make a claim regardless of what they heard or been told by others. You just never know! And you might as well claim money you're entitled to when you can - you never know when it might suddenly get taken away!! ;)