Advanced search

Mumsnet has not checked the qualifications of anyone posting here. Free legal advice is available from a Citizen's Advice Bureau, and the Law Society can supply a list of local solicitors.

Tax credits, childcare and maintenance

(17 Posts)
Drowsyawake Wed 24-May-17 15:33:50

Hi all,

I've done some searching but couldn't find the answer. I've been asked to provide proof of childcare costs for tax credits and I'm getting a letter from the nursery detailing the payments which I'm confident will match my claim.

I am however wondering if I've made a mistake. DD's father pays a proportion of the childcare costs in lieu of maintenance directly to the nursery. As I understand it, maintenance is not taken into account when calculating a tax credit claim however I'm wondering if our set up would be viewed differently because the payments go straight to the childcare provider. Does anyone know the score?

I really didn't think anything of it originally as whether he pays the money to me or them makes no difference to me overall but now I'm wondering if HMRC will view it as if my childcare costs are less than stated?

Babyroobs Wed 24-May-17 15:44:24

Does your ex get a seperate bill for his half of the childcare? or is it all invoiced together.

Drowsyawake Wed 24-May-17 17:13:44

The invoices are for the full amount and we each have standing orders set up (the costs are the same every month)

StereophonicallyChallenged Wed 24-May-17 17:19:57

Hmmmm, in future I'd have him pay it via you. But for now I'd declare it as half cost I think in case they check with nursery.

Who would nursery chase for the outstanding if he didn't pay one month?

Who are the invoices made out to?

Does the ex receive childcare vouchers towards his half?

Sorry for all the questions!

Babyroobs Wed 24-May-17 17:41:14

The problem with this is you are entitled to the help with childcare but your ex is not as the child is not resident with him, yet you are claiming for the full amount whilst only paying half. It would only be a problem if HMRC checked up with the Nursery, which they can do and the nursery stated that you only paid x amount. It could then potentially look like you have exaggerated your childcare costs and it might take some explaining.
It would be far better if he just paid you the money as maintainance and then you paid the full bill.
Is your ex claiming childcare vouchers through his work and using these to pay some or all of his share, because I don't think you are only allowed to claim tax credits for childcare on the amount left after vouchers have been used. This situation could therefore fall foul of that rule. Best to seek advice from HMRC I think.

Leatherboundanddown Wed 24-May-17 18:05:44

Have tax credits not also asked you to send bank statements? I had this recently and had to send all bank statements so they could check the transactions so if you need to do this your numbers are not going to match. They might require you to pay half your costs back. How long have you been claiming?

Drowsyawake Wed 24-May-17 18:38:59

I've been claiming since January 2016 and this arrangement has been in place since then. He doesn't get childcare vouchers. We're both named in the contract but I'm not 100% sure on whether both our names are on invoices - I'd have to check.

Oh God what a mess! I honestly didn't think. So if he paid the same amount directly to me I'd be entitled to what I currently get but with our arrangement I'm not confused

stillawakeatthishour Wed 24-May-17 18:53:06

This happened to me last year. I sent nursery invoices off with a covering letter just explaining that he pays half as part of maintenance and they wrote back to say all is fine and closed the case

Drowsyawake Wed 24-May-17 18:58:08

Still that gives me hope! Ok I'll explain the situation and see what happens (and change our payment arrangements in the meantime!!)

stillawakeatthishour Wed 24-May-17 20:40:22

I was panicking for weeks about it but all was fine

isitjustme2017 Thu 01-Jun-17 10:46:00

I have the same situation. My exP pays some of the childcare using childcare vouchers but I have claimed for the full amount we pay in nursery fees. I was hoping he would be able to cancel the childcare vouchers as obviously I don't want to be claiming for childcare costs he is already paying. Its so complicated!
I tried to work out if I'm better off letting him pay part of it (in leu of maintenance) and claim for the rest, or get him to cancel and claim for the full amount.

Hollytree4 Fri 02-Jun-17 21:18:45

Has anybody suddenly received a letter out of the blue from Hmrc about a tax credit overpayment which they say happened over 6 years ago. Do not think I have any of the relevant paperwork. Must admit to being extremely worried

isitjustme2017 Fri 02-Jun-17 21:54:29

I got one last year about an overpayment of some silly small amount, even thought we hadn't claimed tax credits for years!!!! I rang them and they just wiped it - no idea what it was about but clearly a mistake.

AndNowItIsSeven Tue 06-Jun-17 23:04:12

Isitjustme unfortunately you don't have the same situation if your are claiming childcare vouchers and childtax credits to pay for nursery it's fraud unless it's only childcare costs about the threshold. E.g. For two dc max amount you would receive from
Wtc is £210 however you can only pay with vouchers for costs above £300. Otherwise you are claiming " tax reliefs sort of" twice.

isitjustme2017 Wed 07-Jun-17 08:45:13

AndNowItIsSeven - its not fraud as when I finally get my award from tax credits I will be cancelling the childcare vouchers (as I said in my post). I can't exactly do that first when I don't know 100% whether I get anything towards childcare yet.

AndNowItIsSeven Wed 07-Jun-17 13:58:39

I wasn't implying you would deliberately commit fraud, it's very common to inadvertently claim tax relief twice in circumstances such as yourselves.
Childcare vouchers can't be cancelled, but if they have not yet been paid to the nursery they can be used for other childcare.

isitjustme2017 Wed 07-Jun-17 14:12:57

All I know is its a bloody nightmare when you have 2 lots of childcare voucher schemes involved and trying to come out of them to get tax credits! Tax credits take AGES sending you the award letter too so am left in limbo.

Join the discussion

Registering is free, easy, and means you can join in the discussion, watch threads, get discounts, win prizes and lots more.

Register now »

Already registered? Log in with: