to think the tax credits system is stupid(12 Posts)
Specifically the way they operate the initial claim.
In short. DP moved in end of July and as such my single claim was changed to joint. For reasons I won't go into it was a HUGE mess and I have only just been paid. DP earned next to nothing in last tax year so we have been awarded the full amount. But this tax year he has earned around £28000 meaning the ridiculous sum that just slid into my bank account is hundred more then I'm entitled to. So I'll either have to pay it back or not get any more payments to the over payment has been 'caught up'.
Also I've been paid a rather large amount of WTC as well as CTC. Yet we have no child care costs as I don't work so both kids are home with me. (Except for dd attending the free 15 hours)
I'm going to call first thing to advise of his higher wage but it just seems such a ridiculous way of operating. He is salaried so it would have made more sense to tell the what he will definitely earn this year then go through this stupid system!
Well, if you hadn't told them he's earning more this year then how would they know?
I'm not sure I understand your point.
Wtc arnt just for childcare. Some people are entitled to a childcare allowance through wtc, but many people get wtc without the childcare element.
You can't tell them about this years earnings when you apply. You MUST say what last tax years earnings are. That is the singular way they will calculate your award.
I know this categorically as j asked when I was submitting the claim and the woman in the call centre explained that it must be done against last years figures and that after the award is calculated and the first payment sent only then can it be amended.
I just think that is stupid, long winded and not very efficient.
Re the WTC, I probably don't know enough about it then to complain there so I'll take that one back ;D
You don't work but your partner does, this is a joint claim, that's why you have WTC. CTC is for children not just costs of childcare, you get it for a 17 year old in full time education.
But yes it is crazy.
It is not true that they only go by last year's earnings. You can ring them and give an estimate for this year and they will adjust your payments accordingly. This is what I did when my earrings changed from 20k to nearer 4k a year when I went on maternity leave and would receive only smp. I was paid according to my estimate and paid back any overpayment after they received my p60 (summary of tax year's earnings) at the end of the tax year.
I have had two periods of full pay and smp since then and have done the same - given them an estimate and received amounts based on them ans repaid any overpayment in the next tax year.
The bumf you havecreceived from hmrc does state that if your circunstances change after you've set up your claim (eg your earnings look set to change during the tax year) to ring and tell them to avoid an over or underpayment.
Sensibly, they do not adjust the first few thousand up or down so payment changes are smoothed out rather than cut sharply, as everything gets retallied up at the end of the year, anyway.
I agree totally and since HMRC now receive payroll info via RTI when you're paid there really should be no reason for them to be messing about it should be auto updated on receipt of that info. Its ludicrous really.
We don't claim now but we will be entitled to a small amount of ctc when my twins arrive early 2016 and I'm dreading the farce of it.
I'm a SAHM, we get WTC because DH is on a low wage. He couldn't afford to work if we didn't get them.
yeah they go off last years earnings but as soon as you get that through you ring them to inform them of a change of circumstances for example last year both me and dh were working full time i,m a nurse so was on a reasonable wage therefore we havent been entitled to any tax credits for years ,however ds2 is severley autistic and i gave up work to be his carer so applied for tax credits we timed it right at the beginning of the tax year and they amended them it took a few weeks but we started getting tax credit payments at the end of june.
They can do it on this years, mine currently is. It's based on estimated income for this year.
They'll ask for repayment either after you tell them dh is earning more or at the end of the tax year. They may also spread it out and take it out of next years amount.
If you think you can work out how much they've overpaid you put it somewhere like in savings account and don't touch it, that way you have it when they want it repaid.
I did state in my OP that I know I have to call them and have it adjusted.
I have been calling them once a week since Mid September to check up on the claim and also to try to tell them what he earns now. Each time I have phoned they have said they can't amend his income figure until the actual award is made.
The money has now been paid so the letter will be on it's way so I know that today I can finally have his income figure amended.
It is the act that they are more then happy to send out hundreds more then your entitled to and then I either have to pay it back or have future payments reduced. It just seems ludicrous.
They go on and on about cutting costs but the cash flow system that is set up is crazy.
It is a silly system but I tell you from experience it's better to sleep tight knowing you haven't got any little 'surprises' to come your way in the post at review time. Especially if there is self employment involved.
I had the little 'surprise' back in 2006 and it was bloody hard paying it back, since then times have been hard but when it became clear last August that our earnings for 15/16 would be much higher, I had the accountant draft our tax returns and then adjusted the figure with tax credits people (as an estimate, to be confirmed by submitting the tax return). It meant receiving no more payments for 15/16 as we had already been overpaid and a small payment for 16/17, but I'm sleeping well in my bed at night.
Also means we can try to put aside something for the horrendous income tax bill due January 2017. Some might say I am a little OTT, I say forewarned is forearmed.
Well they probably won't exist for much longer.
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