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Tax Credits Loophole - do you have more than 2 children?

(54 Posts)
CarrieLouise25 Fri 10-Jul-15 17:55:17

I thought I'd start a new thread on the Budget, and the brutal cuts to tax credits.

I spotted this loophole yesterday, and had it confirmed today by reading this article here:

The most important bit being:

*It shows many big families are likely to be hit despite already having three or more offspring before April 2017.

A loophole will count families as a 'new claim' if they've had a 6-month break in claiming tax credits.

And those who already have three children - but who claim for the first time after April 2017 - will also count as a 'new claim', meaning they only get paid for two children.

That means anyone who lifts themselves out of poverty for a long stretch but then loses their job again will lose thousands of pounds.*

Although it says families who currently have 3 or more children won't be hit, as it's only for new claims after April 17, claims become 'new' when there's been a break for 6 months or more.

So say you're currently with 4 children, both working hard (but low pay) and you tax credits top up means you get by. Then somehow you get either more hours/higher wage/better options etc and you don't need the TC's anymore (which would be fantastic right? we all want better wages and not have to rely on TC's) and life is good. Then maybe that job doesn't last/something happens...and you have to rely on TC's to top you up again, you'll only get them for 2 children.

patchesofhappiness Fri 10-Jul-15 18:02:46

Yes, I've spotted this rather grim loophole. Any break in a claim means that you lose the protection you had before.

It's the reason I won't be working any time soon, until I have figured out what my options are (newly single mum, domestic violence, currently existing on income support and tax credits). This is probably not what George Osborne intended! (Or maybe it is? Maybe there is some new punishment coming for single mothers who won't work?)

I didn't ask to be in this position, and honestly didn't see the whole domestic violence situation coming. I've spent the last few months making plans for getting into work. They are all on the back burner now sad I have to think what's best for my children, and I do have to be able to afford to feed them!

CarrieLouise25 Fri 10-Jul-15 18:14:00

Hi patchesofhappiness

Sorry to hear about your situation. I left a similar one 10 years ago now. Well done for leaving, that takes a lot of guts smile

Your children are the most important thing, do whatever is right by them, working or not.

People at the bottom of the rung are being royally trod on, and no one seems to have compassion for anyone's situation these days (especially the wealthy tory voters!)

IDS earns £1600 a WEEK after tax, yet he was published to say he could easily live on £53 in benefits a week. Yeah, ok. Wish all the politicians could walk in our shoes and see how hard it is.

Lots of love and strength to you flowers

patchesofhappiness Fri 10-Jul-15 18:20:09

Thank you flowers

Sleepyhoglet Fri 10-Jul-15 22:46:08


Koalafications Fri 10-Jul-15 23:07:42

Utterly depressing.

On the Matthew Wright show the other day he said that we are missing out on 130x more in lost tax revenue due to big businesses using tax avoidance measures than we will reclaim through these cuts.

Disgusting. Going after the poorest individuals in the country and ignoring some of the wealthiest businesses?! How the hell have we let this happen.

These politicians do not speak for me. They do not represent me or my values.

CarrieLouise25 Fri 10-Jul-15 23:15:47

Does anyone have any ideas on how we can show, and get the media to show how much these cuts will hit hard working families?

Or are the poor not supposed to have a voice sad

RepeatAdNauseum Fri 10-Jul-15 23:21:38

I thought the same - these cuts will stop people trying to get work.

But then I thought, who'd want to be dependant on this lot come the next budget? The same will happen again, and the people who didn't get work to ensure they still get tax credits will get hit again. Eventually the amount of welfare paid won't be enough to live on. So not getting work could be a bad move.

To get the media interested, an angle would need to be found that affects the media's key readership. That's not poor people - if they can't buy premium products or newspapers or advertising, they don't make the media any money.

lloydlf33 Fri 10-Jul-15 23:28:35

Single parents and parents who stay at home while a partner works will be hot when universal credit takes over as there are conditionality rules. When the youngest is 3-4 you will be encouraged to seek work. When they hit 5 you will be expected to work at least part time in child friendly hours so could be school hours. Once the youngest is 12 you will be expexted to work full-time.If people don't comply or aren't deemed to be doing enough to find work they can be sanctioned

tethersend Fri 10-Jul-15 23:38:00

Reading the budget today, it seems that when the youngest child is 2, parents will be expected to 'prepare for work' hmm, with the expectation being that you should be seeking work once they turn 3.

God only knows what they mean by 'preparing for work'.

TheWomanTheyCallJayne Fri 10-Jul-15 23:40:27

Thanks for letting us know.

We've not had tax credits this year due to being a couple of hundred pounds over the threshold. Doubt we'll get as much next year though so may be under it.

What would you say was the best way to keep the claim open then if you're not actually getting anything?

TheWomanTheyCallJayne Fri 10-Jul-15 23:43:18

Where are all these child friendly hours jobs then? There's hardly any jobs here full stop let alone ones that fit around school. And as for holidays...

SurlyCue Fri 10-Jul-15 23:45:01

Does anyone have any ideas on how we can show, and get the media to show how much these cuts will hit hard working families?

I was thinking about this too. How about a twitter hash tag. Something along the lines of budgeteffects where people can say how much they'll lose out on and what the reality of that is. So say someone losing £130 a month which means theyve cant afford transport to medical appointments or to care for elderly parent.

MeDented Fri 10-Jul-15 23:48:38

"Reading the budget today, it seems that when the youngest child is 2, parents will be expected to 'prepare for work' hmm, with the expectation being that you should be seeking work once they turn 3.

God only knows what they mean by 'preparing for work'."

That's what most people have to do that don't get benefits! In fact I had to go back to work long before my children were 2. it wasn't my ideal situation but it's what we had to do.

Athenaviolet Fri 10-Jul-15 23:50:10

What about when someone is entitled, but not receiving tax credits due to repaying an overpayment? Will that count as a break?

tethersend Fri 10-Jul-15 23:53:08

So did I MeDented; I went back to work before both mine were 1- but that's not really my point.

I am concerned by the ill-defined concept of 'preparing for work'.

MeDented Fri 10-Jul-15 23:58:54

But it's not unreasonable for people to be expected to work, why should they expect the state to support them to stay at home? The state can no longer afford to do that.

CarrieLouise25 Sat 11-Jul-15 00:11:58

MeDented it's not about not working, it's about working on low paid jobs and losing our tax credits.

The people most affected are those actually working.

tethersend Sat 11-Jul-15 00:15:15

Again, not my point.

Do you know what they mean by 'preparing for work'?

Because if they expect people to work when their youngest turns two, then they need to make that clear instead of saying that they expect it from 3.

tethersend Sat 11-Jul-15 00:15:50

My post was to MeDented BTW.

CarrieLouise25 Sat 11-Jul-15 00:19:06

Hi SurlyCue

I think that idea would work really well, I was thinking of a twitter hashtag too!

Maybe a simple tweet like:

Two parents, 2 children, both work full time, will lose £1820. Struggling as it is. This will see us go under.

If everyone could tweet basic situations, and get across that they work, and how much they'll be worse off, I hope we could generate a lot of tweets to make an impact.

Ideal hashtags would be IDSisawanker or wishosbournewasonbenefits

However, it might need to be something like, budget2015 or budgethitsthepoor.

Any ideas? smile

GingerCuddleMonster Sat 11-Jul-15 00:26:51


CarrieLouise25 Sat 11-Jul-15 00:29:15

Haha, good one GingerCuddleMonster

GingerCuddleMonster Sat 11-Jul-15 00:31:23

the wine has helped me, I can't take full credit grin

CarrieLouise25 Sat 11-Jul-15 00:32:43


I think preparing for work means attending Work Focused Interviews, it says you need to be prepared with your ideas about external training or courses that you think would help progress you into work and your longer term work aspirations.

Sounds fun.

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