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Child Benefit Query-just under threshold.

(39 Posts)
Rascalls3 Mon 12-Nov-12 21:09:19

My salary varies from month to month-I am cabin crew. My last P60 shows a gross salary just under £49k,but I may end up earning a bit more this year.
Can I just ignore the recent letter as I am under the £50k for the time being and reassess it depending on whether or not my P60 in April 2013 shows a salary over £50k?
I REALLY want avoid (if at all possible) filling in Self assessment tax returns each year-my idea of a complete nightmare! I have always been PAYE and not had to worry about tax etc
I would really appreciate any advice.Considered ringing the helpline, but worried they will just put me down for self assessment. I have 16 year old twins, so will only be getting child benefit until 2014. Assume the tax returns would continue after that once started!!

legoboat Mon 12-Nov-12 21:22:48

i'm in the same boat - in fact, i think this year I'll earn about £150 over the £50k limit. I'm going to amend my pension contributions by 1% from April but to avoid filling one in this fin year, I'm going to request a few days unpaid leave. I REALLY don't want to start filling in tax returns etc. i did a calculation on the hmrc website thing and it says I'll have £6 charge for this financial year(jan-apr) and a £24 charge for the whole of next year.
I'm also looking to reduce my hours to avoid it, I just really cannot be arsed with the hassle of it all. I want to reduce my hours anyway when my DS starts school. Honestly, I'm trying to think of all ways I can to earn a bit less. I just really, really don't want to fill in a tax return each year. Stupidly, my boss is trying to get me a payrise and i'm trying to tell him diplomatically I don't want one, at least until I've reduced my hours!
I know it makes no sense, but all it is doing to me is make me less inclined to work. And it's not about the bloody child benefit, it's about filling in a tax return! just another hassle i can do without.

Rascalls3 Mon 12-Nov-12 21:36:40

You've made me smile. Glad I'm not alone with this one! I will have to get a little clued up on this, your reply was very helpful. Not sure I can workout my earnings until I 've actually done the trips, if that makes sense. I have a company pension and AVCs. I think I can increase AVCs to reduce salary??? Really don't want to take unpaid leave- my work allows me to escape hubby and 3 teenagers!

ihategeorgeosborne Mon 12-Nov-12 22:40:11

We're the same in this house. Dh is mid fifties, but he doesn't want the hassle of a tax return either. He is going to pay the extra into a pension from next April and see how we go with that. If he's still slightly over he will ask for some time off. It really is ridiculous to bring an extra 500,000 people into self-assessment, when in many cases, the cost of the admin will out weigh any saving. Although, that said, he hasn't had his letter yet. Maybe they've forgotten about us! grin

Rascalls3 Mon 12-Nov-12 23:10:19

ihategeorgeosborne, so we can just leave it until April,see how much we are over on our P60s and make reductions accordingly (increase pension,unpaid leave etc)? Sorry I'm being a bit thick, just trying to get my head round all of this. Don't want to end up doing tax returns AND getting fined by HMRC!

MrAnchovy Mon 12-Nov-12 23:39:21

Do any of you give any money to charity? Or belong to professional associations? Or get reimbursed business mileage at less than 45p per mile? Or have pension contributions deducted from your net salary? Or have to buy or clean uniform yourselves?

If so you are probably throwing 20% of all of the above down the drain by not filling in a tax return. I have never yet seen a higher rate tax payer (that was not illegally withholding information about income) not get a refund when filling in a tax return.

In any case you will need to wait for a P11D as well as a P60. And don't forget that any savings income or dividends need to be added in too.

Rascalls3 Tue 13-Nov-12 00:09:38

Oh dear now I am worried. What's a P11D? HELP!

legoboat Tue 13-Nov-12 00:51:02

I was wondering about the charity thIng as I easily give 500+ a year to charity. But but but, i don't want to register and fill in bloody returns each year. I just can't be arsed with it. Luckily no other income, savings or otherwise!
I think reducing hours is the way forward for me.
As the charge is starting January, you have to fill one in if you earn over 50k net in the 12-13 tax year as I understand it. That's why I'm going to try and reduce my hours or take unpaid leave in the period jan-apr 13 to make sure I'm under this year.

ihategeorgeosborne Tue 13-Nov-12 11:56:19

Rascalls3, I think for this tax year, we will just have to take the hit, as it is not really worth us doing the extra pension contributions for the whole tax year, just to save on 3 months child benefit. We will definitely be doing it for the next year though when we stand to lose CB for 3 dc. We don't want to do the whole tax return thing though as it is a real pain.

legoboat, My dh gives a bit to the NSPCC every year, but he just pays that out of taxed income. We've never claimed the tax back before as we couldn't be bothered with a tax return.

MrAnchovy, Why would we have to wait for a P11D? My dh doesn't have a P11D. I thought they were for benefits in kind, i.e. company car, health care, etc? We have no savings interest here either, apart from maybe about £40 a year!! Incidentally, as a stay at home parent with no income of my own, I have never claimed back tax relief on savings contributions from HMRC. Perhaps I should start?

Rascalls3 Tue 13-Nov-12 12:24:29

Thanks everyone.Starting to get my head round it a little. Off to work now. Will check back on this thread when I get back on Friday.

MrAnchovy Tue 13-Nov-12 13:25:24

I was wondering about the charity thIng as I easily give 500+ a year to charity.

Then assuming you pay higher rate tax and the donations can be treated as gift aid you are also donating £100+ a year to HM Treasury.

As the charge is starting January, you have to fill one in if you earn over 50k net in the 12-13 tax year as I understand it.

Yes it does apply for the last 13 weeks of 2012/13: although the legislation talks about your "Adjusted Net Income", it is important to remember that this is actually your ^GROSS^ income adjusted for things like pension contributions, allowable expesenses, gift aid etc. but BEFORE Tax and National Insurance ^NOT^ what you normally call "Net Income" which is after tax and NI.

Aren't you rather cutting off your nose to spite your face? If you really don't want to do the paperwork yourself, get an accountant. It won't cost you more than you are planning to give up by working less or claiming reliefs.

MrAnchovy Tue 13-Nov-12 13:33:29

We don't want to do the whole tax return thing though as it is a real pain.

It really isn't you know, and if you don't want to do it yourself you can pay an accountant to do it for you.

MrAnchovy, Why would we have to wait for a P11D? My dh doesn't have a P11D. I thought they were for benefits in kind, i.e. company car, health care, etc?

Yes they are, and if your DH doesn't get a P11D that is fine.

Incidentally, as a stay at home parent with no income of my own, I have never claimed back tax relief on savings contributions from HMRC. Perhaps I should start?

Do you mean savings income? There is no tax relief on savings contributions.

mercibucket Tue 13-Nov-12 13:35:38

Do the tax return, it will take all of five minutes. If you do it online and have a 'normal' job, all you need is the info off your p60, the info from any dividends that are not already in an isa (where they should be!), and all the details of things you want to claim money back for
Nurses etc - cleaning uniforms at home
Teachers etc - prof organisations (includes unions)
Charitable donations
Etc
Five minutes work equals hundreds of pounds in some cases - good hourly rate!
The form online only gives you the pages you need to fill out and it saves your details, so first year you do 3 pages (example) with name address etc, next year you only need to fill out about 6 boxes
Easy peasy

mercibucket Tue 13-Nov-12 13:35:38

Do the tax return, it will take all of five minutes. If you do it online and have a 'normal' job, all you need is the info off your p60, the info from any dividends that are not already in an isa (where they should be!), and all the details of things you want to claim money back for
Nurses etc - cleaning uniforms at home
Teachers etc - prof organisations (includes unions)
Charitable donations
Etc
Five minutes work equals hundreds of pounds in some cases - good hourly rate!
The form online only gives you the pages you need to fill out and it saves your details, so first year you do 3 pages (example) with name address etc, next year you only need to fill out about 6 boxes
Easy peasy

ihategeorgeosborne Tue 13-Nov-12 13:52:16

MrAnchovy, Sorry, yes I did mean savings income. As a SAHM, our savings accounts are in my name mostly and I have never claimed back the 20% tax on interest that the banks pay to HMRC. Again, I couldn't be bothered in the past, but perhaps this is the incentive I need. Can you back claim?

mercibucket, Thanks for the advice. We just got a bit worried as we've NEVER had to do one before and have been told from various sources that it is hard work! We don't have any other income apart from employment. We do give a bit to charity but not much, so never bothered claiming. Dh gets some travel expenses from work, but they are paid from his company directly to him every month, so I assume there is no claim there we can make. Just scared of the fines!!!

mercibucket Tue 13-Nov-12 14:03:42

They're only hard if you're self-employed. Mine takes me ages but that's cos I have to sit down and work out how much I actually earned, go thro all the receipts etc. The part where I put in my'employed' income takes mere seconds to do. Just keep the p60 somewhere safe, along with any annual interest statements etc from the bank (I can get mine online) and away you go. It also makes me donate more effectively - less 'money in a bucket', more 'regular direct debit'

mercibucket Tue 13-Nov-12 14:03:42

They're only hard if you're self-employed. Mine takes me ages but that's cos I have to sit down and work out how much I actually earned, go thro all the receipts etc. The part where I put in my'employed' income takes mere seconds to do. Just keep the p60 somewhere safe, along with any annual interest statements etc from the bank (I can get mine online) and away you go. It also makes me donate more effectively - less 'money in a bucket', more 'regular direct debit'

MrAnchovy Tue 13-Nov-12 14:14:07

Can you back claim?

You have until 5 April 2013 to claim for 2008/9. Start here.

Dh gets some travel expenses from work, but they are paid from his company directly to him every month, so I assume there is no claim there we can make.

Might be. Is there any cost he incurs that the company don't reimburse - mileage is a common one, either paid at less than the approved maximum rate of 45p per mile or not paid for part of the trip (you can normally claim your mileage from home to a temporary work place but work may only pay the mileage from work).

ihategeorgeosborne Tue 13-Nov-12 14:25:27

Thank you, I will start the process. It may not be much but it all helps!

Not sure what his company pays. I think it is mainly rail fares, but I'm sure there is some mileage too. I'll ask him what rate they pay. Thanks

legoboat Tue 13-Nov-12 16:49:01

Thanks Mr Anchovy - you are right, it is cutting off nose to spite face but because I'm (hopefully) going to be reducing my hours with my son starting school sep13, I think I may as well get my salary for this tax year under the threshold as it will be next year anyway. So effectively only completing a tax return for the sake of the 12 weeks in the new year seems silly. I do understand the gift aid thing too, I just don't want the hassle of more paperwork.

I think I've been calculating correctly on the adjusted net income malarky:
I get c.£50k salary (pre tax/NI), £5k car allowance and £1.25k medical insurance. But pension deductions are £3k, childcare vouchers £3k.

So am I right in thinking, I'm just over?

MrAnchovy Tue 13-Nov-12 19:03:20

Yes it does sound like you are close, but don't forget you can take off those gift aided charity payments even if you are not actually claiming back any tax for them. You have until October to work it out so by then you should have final figures (medical insurance for instance will be on a P11D). I suggest you do a 'shadow tax return' - download the form, read the notes and calculate your Adjusted Net Income.

fallingsun Wed 14-Nov-12 09:33:05

Does anyone know - if I increase my company pension contributions (dc scheme) will this reduce my salary for child benefit purposes?I think I'm under the 50k threshold anyway, but wouldn't do any harm to make sure by increasing my pension?

mercibucket Wed 14-Nov-12 14:15:50

A lot of people will be increasing pensions to reduce overall income for cb purposes - win, win. I'd like to know if you can also contribute to someone else's pension eg spouse and it counts. Anyone know?

mercibucket Wed 14-Nov-12 14:15:50

A lot of people will be increasing pensions to reduce overall income for cb purposes - win, win. I'd like to know if you can also contribute to someone else's pension eg spouse and it counts. Anyone know?

ihategeorgeosborne Wed 14-Nov-12 14:39:37

mercibucket, I asked a pension provider this question, and apparently, you can contribute to a pension for a spouse, but you don't get the tax relief. Dh will be paying an extra 6k into his pension for the purpose of CB. Bizarrely, this will only reduce take home pay by £100 a month once you factor in the fact that we won't lose 2.5k in CB.

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