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Warning Tax Credits: this is what happens if you move in with new partner...

(42 Posts)
inflatableflowers Sat 21-Jan-17 16:07:33

... and forget to inform Tax Credits you've moved in.

Genuine mistake in my case.
I have been a lone parent and lived alone with my kids since 2006 (alone during pregnancy too).

March 2016 I moved in with my partner of 4 years.

I didn't inform Tax Credits until July 2016.

I now have a bill for £3,900 fortunately it can be repaid in monthly instalments.

My mistake was part stress related as we'd moved into partner's small one bed flat temporarily (4 people in there cramped and stressful) plus he works from home, and part disbelief that fines or overpayments were 'real' , and were just threats.

They're real.
My overpayment doesn't include a fine, but this is just to remind the odd person who like me might find that circumstance or in worst case scenario deliberate defraud intent, think they can get away without being fined or having to repay the overpayment.

inflatableflowers Sat 21-Jan-17 16:10:00

Also if you are thinking of moving in with a partner, and you both work with a modest income, you will still receive tax credits, but a couple of hundred less than you would receive as a lone parent.

In retrospect, as a lone parent, you will be better off financially if you work part time with working tax credit, than moving in with an employed partner who is on a modest income.

Somerville Sat 21-Jan-17 16:19:16

How could it be a surprise to anyone that they will be entitled to less support from the state if they move in with a partner?! And that if they fail to report their change of circumstances - they will have to repay the money they were given but not entitled to? confused

Somerville Sat 21-Jan-17 16:24:19

And I say that having been in receipt of a state benefit recently. Every letter I ever got about it reminded me in big red lettering to inform them of any changes in circumstances.

inflatableflowers Sat 21-Jan-17 16:26:33

Because some people may not realise they're entitled to less financial support. Depends on their new partner's income.

If their new partner has a high income, the mother will receive less or no tax credits if exceeds the threshold.

If the new partner is self employed, there a few options that can complicate tax credit entitlement.

If one or both of you are unemployed, even less assumption you're entitled to tax credits.

My OP is just to advise anyone who isnt aware that there will be repercussions. Some people's circumstances, financial, health or otherwise can complicate the issue.

inflatableflowers Sat 21-Jan-17 16:28:22

Everyone with a child is in receipt of benefits,

be that Child Benefit, Child Tax Credit, Working Tax Credit, etc etc

Some of us procrastinate, to our detriment (there's no kicking self in foot emote..)

cherrycrumblecustard Sat 21-Jan-17 16:30:44

No, they really aren't inflatable

Somerville Sat 21-Jan-17 16:36:59

I'm really confused. How could anyone not understand that as (let's say) one adult with one income on which to support their dependants they are likely to need more financial support from the state than two adults with two incomes supporting their dependants will need?

Somerville Sat 21-Jan-17 16:41:40

All the thing you listed were means-tested benefits, OP, so it is absolutely not the case that everyone with a child is in receipt of them. I'm not myself.

I used to get a non-means tested benefit, but I wasn't entitled to it any longer when my fiancé moved in.

AndWhat Sat 21-Jan-17 16:43:06

I've posted this before.
We claimed working tax credits a few years ago I was a student and husband on low income. DH got a promotion in July and we informed them straight away and our payments reduced, then I qualified and started full time work in September when all payments stopped as expected. The following July we received a letter stating we had received overpayments of £3k.
Upon speaking to them they base the payments you receive on you earning x amount through that tax year, if you go over that amount they will request ANY monies received by yourself from that April back (If that makes sense).
This is why they ask for an estimated income and you shouldn't go over it.
So they will be asking for all tax credits back that you received that tax year-it's the most ridiculous system!

AllTheBabies Sat 21-Jan-17 16:46:06

Surely it's completely obvious that your benefits decrease when you have a higher joint income?! It's the basis of the whole system! confused

Mine stopped completely when we moved in with dp.

QuitMoaning Sat 21-Jan-17 16:46:48

Not everyone with a child is in receipt of benefits. I was a lone parent and for the last few years I have received no benefits at all.

WatchingFromTheWings Sat 21-Jan-17 16:52:55

I was on Tax Credits for a number of years. I seem to remember it was outlined in all correspondence that you are to immediately notify them of a change in circumstances. Doesn't matter if it's a change in pay or a partner moving in. There's not really any excuse for not knowing.

DixieNormas Sat 21-Jan-17 16:58:45

I don't know why people struggle to understand all this, I don't know how you can just forget to inform them either.

reallybadidea Sat 21-Jan-17 17:08:05

An almost £4k overpayment from 4 months where you were living your partner before you declared it?! Are you sure that's been calculated correctly?

Middleoftheroad Sat 21-Jan-17 17:26:26

Tax credits took DH's income down wrong when I phoned them up to report a change. Cue a demand 2 years later for 2-3k back. However, I put together a case, got a transcript of my original phone call and proved I had given them a post tax figure. They didn't have a leg to stand on.

HMRC cock up all the time. Most peoe don't try to get away with anything OP- it's that the tax credits mafia are so unbelievably inept and aggressive in their demands. Scaring people and pulling figures out the air.

I was scared to claim in the end. We don't rely on them.now but they randomly send letters claiming oddly calculated amounts. They try it on - I'm convinced of it - and when I challenge them back in writing (always in writing now) they can't seem to be able to explain the calculation!

keep evey bit of paperwork.

thenewaveragebear1983 Sat 21-Jan-17 17:30:09

Part disbelief that fines were real so you knew, you just didn't think you'd actually get caught or have to pay a fine?
I am astounded that you owe £3900 for 3 months tax credits. That's more than I earned in my actual job over 3 months (even 4-5 months). Too right it should be paid back.

thenewaveragebear1983 Sat 21-Jan-17 17:31:22

And no, not everyone with a child is in receipt of benefits. Even CHB.

WatchingFromTheWings Sat 21-Jan-17 17:43:13

I am astounded that you owe £3900 for 3 months tax credits. That's more than I earned in my actual job over 3

It's not that surprising an amount tbh. That's not far off what I was getting as a single parent of 3 working 8 hours a week.

aintnobodygottimefodat Sat 21-Jan-17 17:50:47

Another person here with 2 children that does not receive benefits.

Really all the info is readily available on the government website. It's set out pretty simply and has numbers to call if there's nothing you don't understand.

Isadora2007 Sat 21-Jan-17 18:01:01

I can't say it's a surprise really. But I must say it is a little unfair to assume that everyone who gets into a serious relationship with a single parent is going to be able or want to be financially responsible for those children. I know many people are. But it is still a bit unfair that tax credits don't take the parentage of the children into account.

inflatableflowers Sat 21-Jan-17 21:03:59

the pnewaveragebear

It isn't a fine, it's an overpayment. You didn't think you'd get caught makes my situation sound like intentional fraud confused

It was an error on my part not to inform Tax Credits, not deliberate.

Are some of the posters here with young children saying they don't receive Child Benefit? I thought everyone with a child under 16 received Child a Benefit if their income is below £70k or whatever the current limit is.

Marmalade85 Sat 21-Jan-17 21:13:48

I don't really understand how you 'forgot' to inform them either OP.

lougle Sat 21-Jan-17 21:27:58

You can't 'forget' to let them know. You just can't. You know that having a partner changes things. Any change of circumstances needs to be reported.

aintnobodygottimefodat Sat 21-Jan-17 21:28:53

I don't receive child benefit as my husbands income is over the (£50k) threshold.

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