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Can anyone help answer a couple of WTC questions please?

(5 Posts)
mogs0 Tue 12-Jul-11 17:44:48

I have been to the JCP today and the lady I saw has really confused me and now I'm stressing about everything.

In August my IS claim will be closed and I have to apply for WTC. I'm a s/e childminder and I was told I'd have to submit all my earning/expenses when making a claim for WTC.

Can I make a claim online? If I can, do I then have to forward my business accounts?

vickibee Tue 12-Jul-11 17:48:06

you tax credits are based on a best estimate for self=employed income. I assume it is a new business so it is difficult to predict but you must have a rough idea of income and expenses to arrive at a profit figure. IMO it is best to over estimate so you don't end up with an over payment situation

mogs0 Tue 12-Jul-11 18:00:09

Here's where the situation gets more confusing...grin...childminding has its own set of rules in terms of IS so it's not a new business. I have been s/e and filing a tax return for a couple of years but making a relatively low profit so am still meeting the criteria for IS.

I'm not the most organised when it comes to book-keeping (usually submit my tax return during the last week of January blush) but I know exactly what money has come in and roughly what has been spent on expenses. If I give them these figures is that enough? Do they need to see my accounts or do they check when I've submitted my tax return?

Also, do they base the claim on last tax year's profit?

I am so confused!

I'm worried about it all taking ages to go through at this time of year when they are inundated with renewals etc.

mogs0 Tue 12-Jul-11 18:21:50

Panic over!! I have just got through to someone on the helpline who was very helpful and given me all the information I need to enable me sleep tonight grin.

Ruralgeek Tue 12-Jul-11 18:56:44

Well done, make sure you download form TC846 from their web site as well. After working out your self-employed profit/loss you can also deduct other items such as the gross amount of any personal pension contributions and the gross amount of any gift aid donations.

If you make a loss, don't be confused by the main tax credits form where it just tells you to put zero, you can actually put your loss on the TC846 form and then carry it forward to the next year so it can be deducted from any profit you make the following year (you do still put zero on the main form though).

Be aware that HMRC can be a bit funny with self-employed people (particularly if you're married to someone who's on PAYE) and write to you suggesting you're on a higher income, when you've actually had to deduct your partner's loss from your income using TC846. In this situation they will probably ask for your accounts or figures from your accountant submitted for tax purposes, so long as you can satisfy them if they ask then you should be ok.

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