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Tax credits - childcare

(25 Posts)
Hutch2017 Mon 20-Mar-17 09:54:26

I'm currently looking into tax credits as I would like to separate from my partner but am worrying about finances.
I'm currently in the £20k-£25k salary bracket and I currently pay on average £60 per week childcare.
Looks like I would get £470 (Child tax credit) every 4 weeks and £107.52 (working TC).
However, I would probably have to double my childcare costs if I was alone as I doubt our current arrangements would continue and it looks like I would barely get half of my costs paid, which means I just wouldn't have the money. Not sure what to do...... I have another 1.5 years before youngest is at school and out of childcare.

Leatherboundanddown Mon 20-Mar-17 12:14:05

Does your partner work? If so they will owe you child maintenance too. Are your outgoings very high? As otherwise it looks very doable to me even with £120 a week childcare.

Hutch2017 Mon 20-Mar-17 12:42:36

Yes he does and looks like he's have to give me around £200 per week. Rentals aren't cheap though so I'd be looking at around £600 per month. Nightmare

Hutch2017 Mon 20-Mar-17 12:43:11

£200 per month not week!!

Leatherboundanddown Mon 20-Mar-17 12:48:12

My rent is 650 pcm and my salary is much lower than yours. It will be ok. From your numbers you will have a minimum of £2130 a month coming in and that is based on your salary being the lower end of your bracket at 20k and the lower amount of childcare costs, so if these double you may get slightly more towards your costs.

So salary min 1300
Maint 200
Child benefit 82
Tax creds 580

The last two are 4 weekly not monthly so will even be slightly higher monthly.

Honestly this will be fine.

GreenGoblin0 Mon 20-Mar-17 13:07:58

why do you think your childcare costs would double?

Babyroobs Mon 20-Mar-17 13:50:44

what will your housing situation be? You may be entitled to some housing benefit but that may be affected b whether you own a house with your ex.

Leatherboundanddown Mon 20-Mar-17 13:56:50

With a rent of 600 and a 20k job definitely no housing benefit I am afraid, the thresholds are much lower.

Hutch2017 Mon 20-Mar-17 14:57:15

Childcare cost would double as MIL has ds 2 days per week but this isn't going 2 last much longer as FIL very ill. I'll have to rent as my current house has zero equity and will probably struggle to sell at all. Looks like I really need to sit down and look at figures again!

Babyroobs Mon 20-Mar-17 15:50:39

Is there no way you can stay in the maritial home with the kids and your ex move out? Sounds like you need to speak to a soliciter to find out what your options are. Sometimes a court can order that you can stay in the maritial home until your youngest child turns 18. Would taking on the mortgage be more manageable than paying rent elsewhere?

Hutch2017 Mon 20-Mar-17 17:27:27

That would be ideal but he's too selfish to leave so would never persuade him. Mortgage is £750 per month so I'd probably not manage that! I couldn't afford to leave as would hv 2 rent and pay half the mortgage until it sells.

Leatherboundanddown Mon 20-Mar-17 21:02:56

I think you could do £750 ok. Yes it will be tight but doable. If you did stay in the house you could rent a room out. This income is tax free so is not taken into consideration for tax credits.

Hutch2017 Mon 20-Mar-17 21:19:38

Thanks. It probably would be doable (I'd just be skint). It would be my ideal scenario but we would still have to sell the house and no way could I save anything in this time to allow me to have the cash to rent. Think I'm gonna have to concentrate of stashing as much money as I can over the next few months!

GreenGoblin0 Mon 20-Mar-17 21:26:56

why would you have to sell the house? might be a good idea to post in legal for opinion on whether you will be able to keep house.

Hutch2017 Tue 21-Mar-17 10:45:15

The house is in joint names. Even if he signed it over to me (which he won't), the bank would never let me take on the mortgage as my salary wouldn't be anywhere near enough. We have a 2 year fixed mortgage so when that comes to an end, we would both have to remortgage the house as the new payments would be over £1000 a month. I can't see him coming along to remortgage a house that is no longer his.

Leatherboundanddown Tue 21-Mar-17 11:54:11

You can get a mortgage lender to take your tax credits and maintenance into consideration too which may help you. Use a broker.

drspouse Tue 21-Mar-17 12:01:10

Does your youngest get the free hours? You may get 2 year hours if your income is low enough, and you will definitely get 15 free hours in termtime once they are 3 and possibly 30.

Leatherboundanddown Tue 21-Mar-17 12:11:09

I think salary needs to be under 16k to get the free hours at 2

drspouse Tue 21-Mar-17 12:14:36

You're right, it's around £16,900.

But the 15 free hours will definitely kick in soon if it's 1.5 years to school and the 30 hours may be possible as single parents only have to earn NMW for 16 hours a week.

Leatherboundanddown Tue 21-Mar-17 12:24:55

That is great news then. OP maybe start doing research now into childcare providers in your area who will offer the 30 hrs and get your name down. I know where I am there is lots of talk of them not being able to offer them to parents as they will make a loss. There is definitely at least one though.

drspouse Tue 21-Mar-17 12:27:48

Our DD's nursery says they don't know enough yet to say whether they will offer it or not - so we are a bit in limbo over our childcare.

Hutch2017 Tue 21-Mar-17 14:21:37

The 30 hours won't be completely free. I currently get 15 hours but still have to pay £24 per day childcare because of the wraparound so I'm only saving £12 a day. I would be eligible for it though and have already put my name down.
I wouldn't get a bit enough mortgage even with tax credits. I'd be able to get a mortgage of about £50k less than I need!! so, keeping the house isn't an option unless I win the lottery.

drspouse Tue 21-Mar-17 14:28:40

They are no longer going to be allowed to charge for wraparound.

Leatherboundanddown Tue 21-Mar-17 15:00:10

Ok, you could look into sharing a house with someone else so your rent would be cheaper. Or sharing a small flat with your dc and not having a living room/sofa bed in one room etc. Can you see your wage increasing much over the next few years?

Hutch2017 Tue 21-Mar-17 16:28:30

drspouse - that is interesting! I never understood how they could charge £36 for a full day but then (after deducting 6 free hours) charging £24!

I may have to consider 2 bed houses flats anyway - very short of rentals at the moment.

Thanks for everyone's advice.

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