To be shocked at how much we would get in tax credits if I did not work

[peppapighastakenovermylife]

I sense this thread might go wrong - I do not mean it to. I am not saying people should not receive the money, nor that they should be forced into work. I am just shocked at how much we would get!

Bit of background. My job is at risk so looking at worst case I wanted to see what we would be entitled to if I was made redundant. I expected it to be very very little.

I put our details into the tax credits website and based on me staying at home with the DC's and DH continuing to work full time we would get £600 a month . That is not considering any other benefits which we might be entitled to (DH earns around 18k)

Ok so that is not a huge amount of money to live on but after childcare costs that is more than I have left over after working full time in a well paid job!

I fully admit I enjoy my job and working. I also get more out of it than salary - pension, fulfillment, career advancement. Also, childcare costs are a relatively short term thing - in four years once all DC are in school they will come down considerably (they are very high at £1400 a month now).

I have no intention of leaving my job but it does make me wonder why I am missing my DC's, running round like a mad fool organising childcare and picks ups and am absolutely exhausted and dont have much time for myself when I am in the short term worse off financially.

It is nice to know there is the safety net though I guess although I now understand why some people make it a choice not to work (and I mean some not everyone who doesnt work, stays at home etc). I genuinely never expected it to be that much. I guess it will also be at risk with the current government.

I'm a SAHM with 2 DDs and we don't get any where near that much..........

Perhaps the government should run nurseries? Then it would be more worth while for more people to work and be a true choice.

TSC, the rates are published each year.

For each non-disabled child over 1, a 'child' element is added, worth £2300 per annum. If you have a child under the age of 1 year, then the premium is increased by £545.

So, having just had a newborn (congrats, by the way ), your 'rate' has increased by £2845.

However, there is a taper, and after the £6420 threshold disregard, your tax credits get removed at a rate of 39p in the £1.

So, because your family income is £17003, you would get the entire increase, because you have already had £4127 deducted on the basis of earning £10583 over the threshold.

Basically, you will get your TCs increased by £54 per week because you now have DC3.

I always say it on these threads, but what really makes me cross is that they give the impression that tax credits are so complicated, that us little people can't possibly work out how much we receive.

It isn't true.

If you can do simple maths (+, -, x & /), and can follow step by step instructions, you can work out what your TCs would be in any situation.

In actual fact, the most TCs come (excluding disabilities) if you and your DH were to work 16 hours each. You still get childcare paid, which means that you could send your child to preschool at a very much reduced rate if they were under 3 and still paying, but still share childcare, and still get the premium for 30 hours per week.

A few years ago, I got a pay rise at work, that was catch 22. It meant that I would lose all TC etc, but not be enough in my pay packet to cover what I lost. I spoke to my employer and said that I really didn't want to accept the payrise for that reason, my employer and I sat down did the calculations to work out what my pay would have to be, we were shocked, but my employer said they'd prefer me not to be receiving benefits, so they gave me a larger pay rise, but with the caveat that I would not get another one for 2 years, and if I left during the 2 year period I would have to pay the difference back.

Now that's an understanding employer.

I think the £600 comes from having 3 DC's (so more per child you have) and the baby element. And yes it is all going to change.

The point wasn't about making a decision to stop working based on these figures - just me exploring what would happen if I lost my job. I always presumed we would lose the house, be sharing one slice of beans on toast etc etc if I did lose it but actually our income in the immediate term would not be that different.

Long term I am much better off working - ignoring the fact I actually like my job. I would also feel hugely guilty giving up a job because I could claim benefits - even though with three DC's under five I'm sure many would understand why.

It is just a shock how much we could get in the current climate - I am not placing a value judgement on whether that should be higher or lower at all. However I do understand why a minority see it as a lifestyle choice - if you hated your job, why would you bother. I would have one DC at school, one eligible for free nursery, so essentially I wouldn't even be home with 3 DC all day long. It must be very hard to think of the long term picture in that situation.

The only thing I am resentful of is the fact that in difficult work situations before I have put myself under immense stress (DR recommended I should be signed off with work related stress before which I refused to take ) and been so worried about losing my job I have made myself ill. Although it wouldnt have made me give up the job I wouldnt have worried so much about losing it. I also rushed back to work twice when the DC's were five or six months old when in reality I could have stayed home longer. And then got landed with guilt / criticism for doing so.

But anyway - all in all I am pleased the safety net is there. But that is just what it should be.

Exactly Peppa, and imo that is what tax credits are for. A safetly net for hard working people who have paid in to the system for years.
Thank goodness we live in a society where this is possible and Im pleased you have discovered the information so hopefully you can relax a bit about what would happen if you lost your job.

it is true that so much more comes with a job than just the money. And violethill makes a good point as ever about how some of her friends who gave up becuae they could earn as much money at home have missed out on building a career that will provide them with money once the kids are grown up and they are no longer entitiled to CTC.

I really hope they find a way somehow to bring tax credits back to be used in the way you are using them i.e. as a safety net. Rather than as a way to stay at home and earn the same or more than you would if you worked. Because I fear if they are not then they will have to scrap or alter the scheme altogether. As someone said above, the way it is working currently it is not sustainable.

Things would be a lot simpler in this country if house prices were more affordable, say affordable on one average income.

People get mortgages on the basis of two incomes and then have hard decisions to make when having children. With lower mortgage costs a lot of people could make the decision to stay at home or go to work and pay for childcare without having to rely on government top ups (and who wants to be reliant on the government in this current economic climate). The help could still be there for the low earners.

It would surely save a load of housing benefit too if house prices and therefore rent was half the price it is now.

Well as single mum with two children and I work earning less than half OP's income - I don't get as much in TC and WTC as the OP's household. There will be though a great overhall of the tax credits system and you can see why

But it shows really well to me that single mothers are not the purge on society that is made out on areas such as the press

I believe you are right Katy.. I think if you do the calculations that couples where one stays at home and 1 is on a relitively low income claims more than a single working mum...

with one child, we only ever got £545 per year tax credits, with me at home, and DH on £20K a year at first. am slightly bemused at the £600 per month figure. and suspect come next year it won't be quite so much....

Katy and totalchaos - try it in the calculator yourselves.

I think they key points are that I put in three DC with one being a brand new baby - so the baby element is involved.

It goes up with each child - I can see why people get the idea of 'mothers having more children for extra benefits' from (again am talking stereotypes, not whether people do or not).

Thesecondcoming - I think it is fair enough in the short term. You have a tiny baby and two other children - I think supporting new parents in this way is a good idea. Its when people can make long term choices not to work when they are able to, based on the figures that it becomes an issue.

It also blasts away a lot of the myths about 'scroungers' doesnt it. No one bats an eyelid at a married couple getting this money - but single parents etc get ostracised. Also those who recieve help with nursery costs. When we earned less we were getting around £500 a month in nursery fees but we were paying taxes so really came out neutral (not paying the state anything, but not costing anything if that makes sense). If I had stayed home I would have had the same amount of money given to me but not have paid any taxes.

It is all very very complicated to say the least!

Well my partner works full time gets 17k a yr and we hardly get any tax credits.
However other people we know with more kids get £300 a week tax credits on the same pay!

Is it any wonder people have so many children nowdays?

Thesecondcoming I would not take it as an insult - perhaps they thought you were over qualified or something. They tend to take weird approaches to the responses - looking for things you wouldnt think were importnat.

For what its worth I have a PhD and have tried on several occasions when not in full time work to get a job in a supermarket and no luck!

Short term - in my view, as long as you need it. Need it very hard to define though!

kayla - exactly. We would have got very little with just one DC. I guess more DC's cost more in terms of food, clothes etc but is it really that straight forward?

I was doing brilliantly as a single mum working 25 hours employed and the extra 5 hours as self employed with my child in daycare from 8 till 4.
When DS went to school it all changed. I lost the hour after work to do shopping errands etc. Then I lost my Self employed contract. just working 25 hours meant I lost on WTC and as of May I gave up my job completely. Just couldn't afford the car,stress and finding an Ofstead childminder (the only sort I can claim back on )for the morning school run.

There is definatly a point at which you are over compensated and one where it's just not worth it.

"Well as single mum with two children and I work earning less than half OP's income - I don't get as much in TC and WTC as the OP's household. There will be though a great overhall of the tax credits system and you can see why

But it shows really well to me that single mothers are not the purge on society that is made out on areas such as the press "

Ivykate, there must be something in your circumstances that is different to the OP then (other than the fact that you are a single mum)

The way Tax Credits work, you are not penalised for being a single parent.

-Everyone gets the 'basic' element
-There is a 'couple and lone parent element', so you would get the same regardless
-A 30 hour element
-CTC family element
-Baby addition
-Child Element

So, if you are working less than 16 hours per week, you won't get anything other than the CTC family element, plus 2 x the Child element.

If you are working over 16 hours per week, you would get

Basic element + lone parent element + CTC family element + 2 x child element.

If you are working over 30 hours per week, you would get

Basic element + lone parent element + CTC family element + 2 x child element + 30 hours element.

(All adjusted for your income (total award - ((Income - £6420) x 0.39)))

Peppapightoml, gets

Basic element + lone parent element + CTC family element + 2 x child element + 30 hours element + baby element

Sorry,

Peppapightoml, gets

Basic element + lone parent element + CTC family element + 3 x child element + 30 hours element + baby element

Lougle, dont mean to be rude, so please dont take offence i find the whole ctc / wtc confusing - and your posts have added to that confusion .

also, if its so simple to work out, where are there repeated posts here complaining of them being incorrectly calculated by the tc agency?

my own circs have a number of deductions for various things that i cannot make head or tail of - as they are inconsistent and a bugger to decipher. letters that say, 'provisional' and 'actual' awards are poles apart in my case. i say this as a poster with a phd and unable to work out the 'elements'.

not a criticism of you, but of the calculation system. just thought id mention that.

by the way, when i used the on-line calculator, it was miles out from what i was actually awarded. my advise is to treat any 'enlightenment' about what you may be entitled to with extreme caution. and dont go making major career decisions based on that calculator alone.

I find it really galling that as two working parents (me part time) we get absoloutly zilch. If you are a lone parent, it seems they cant do enough for you.