to think that if you used to moan about the Tax Credits system....

[ThatVikRinA22]

that you have a lot more to moan about now?

I always used to wonder why people bemoaned the Tax Credit system - it enabled me to go back to work, it helped me pay for child care that made working worth while - it really helped me when my children were younger, before TC i used to work, but most of my wage went on child care.

Up until this government got it, we still got a small amount of TC, - it helped hugely.

Yesterday, i got the renewal through. Ive not had any payments for months and so i rang them to ask why they had sent a renewal through that made no sense - it said we should get about £4k but then deducted £4k.....

so i rang them.
Now, if your household income is more than £26k (with one child still at school) you get nothing.

if our household income was 26k, we would be unable to pay our mortgage, or eat. I have no idea how they think that people with families to support, who pay mortgages and rising bills, petrol costs etc can afford to live on that?

my wages look good, but by the time ive paid into the (rapidly declining) pension, £200, paid petrol, £250, mortgage, £685, council tax, bills and food, and im trying to support my eldest through university by paying for his food, there would be a serious serious shortfall if we had only my wage alone.....

i have said on threads before that i couldnt understand people moaning about the TC system.....

Is it a case of you dont know what you ve got until its gone?

Lougle very clear but
I just did that with my current figures and got a number that is nothing like what we are currently paid. I'm now worried they're going to claim back thousands of pounds

If its 41% now what was it before and are there any other variables that may have changed compare to last year?

Ooh major X-post!!

Thank you again Lougie I really appreciate the explanation and workings!

Ahh just seen Faye's comment
I too am getting a vastly different figure
Like over £5000 different

Thanks Lougle....personally I didn't understand most of it. And I got an A at A level maths!

Ghostship. Because most people just about manage on whatever income they get. So before tax credits came along they just about managed. After tax credits they just about managed. Why? Partly because as Orwellian explained very well as you give people more money, prices simply go up. Especially when the value hasn't been added.

Let me give you an example. Why doesn't the government just eradicate poverty by giving everyone £1million. I mean they print the money. Just print it and poverty will be ended overnight yes? Well no. Why not? Well first thing I'd do is trot to my nearest Ferrari dealer and try to buy a modest Ferrari. Let's say the cost is £250k. Still very affordable yes? I have £1million afterall.

But wait....everyone else has £1million too. But the Ferrari is rare. And crucially the salesman selling it also has £1million already. All of a sudden he finds that he can easily sell it for £500k instead because someone else wants it more than me.

And that's pretty much what happens when you give a large swathe of the country money which hasn't been earned. Prices go up. It's the law of supply & demand. Houses are in scarse supply. Esp down south. So prices go up.

The bit which really tips us over the edge is that Labour borrowed the money. It wasn't money we've taken off the rich to give to the poor. We borrowed it. So the £1 you get now from tax credits/whatever. Our children will probably be paying it back with interest. And thanks to the miracle of compound interest, they'll probably be paying back £2. Oh whilst being told that they need to support us too for pensions we gave ourselves without any care for if they can afford it or not.

Sorry my fault
I disregarded the wtc as on our reward it says we're not entitled.
I hadn't noticed the one I was you posted and was using as a jig includes even though she too is a sahm.

The calculation isn't far off though I'm a little confused as they say I'm not entitles but I only get a close answer by including it.
No wonder people get confused

Niceguy do you think as HB is withdrawn at the top end, rental prices are going to go down?

Genuine question. If I had to make a prediction I would say that they will not, so we are looking at a social clearance of the poor, mostly the working poor as 7 out of 8 claimants for HB are in work, from the capital and other areas of the SE.

What is your solution for this? I dont' think banging on about whodunnit any more really cuts it. And I am not a Labour supporter.

btw not saying you have to have a solution! As I sure don't. I think we are f*ed. And it's global, except in countries such as China and India where living standards are now rising and in a few decades they may face the same problems we are facing now.

I agree with Orwellian. You should not rely on tax credits to make up the shortfall between what your wages are and your outgoings. Do people not sit down anymore before they have children and work out if they can afford it? I do understand though that sometimes situations arise that are beyond your control butwhen the welfare state was set up benefits were supposed to only be a temporary measure until you were back on your feet.

So Crinkle... what do you suggest the country does with it's thousands of children whose parents failed to budget for them properly?

This is the bit that gets me about the personal responsibility argument. It's all well and good if we educate future parents about it (and I for one don't think that would be a bad idea, although non-reproduction is always going to be hard to enforce unless you believe in compulsory sterilisation)- but the fact is that a whole raft of 'unaffordable' (?) children are now in the UK. Should they now suffer for their parents' sins?

I think that the immediate answer from the right will be 'tough sh*t' which basically means 'yes'. But I would love to know if they are ready for the social misery, unrest and massive prison and care bill which will inevitably result.

faye check out her revised sums that she kindly posted just as i was about to leap on it and go noooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooo thats wrong

Are the actual payments reducing, or is it just the people who can claim it being reduced. Say you are on a very low income now (less than 10k) will they still continue to get £60 a week for the first child?

I get no contribution to childcare from tax credits at the mo, because I only work 7hrs per week. My dh works full time.how many hours do I have to work for tc to contribute towards childcare costs? And how does the contribution work - do they pay a % of the actual costs, or a flat rate?

@Domestic. The honest answer is I'm not sure since your question is specifically about the top end. It will depend upon how many houses are being rented out due to HB and how many people can afford the fill the gaps without HB.

If it turns out that by removing HB that a large amount of people cannot afford high rents anymore and there's not enough people left to fill that gap then yes...prices will have to fall.

And the 'social clearance' argument is illogical, emotive nonsense and plain stupid. We all have to live within our means, whatever that may be. I'd love to live in a nice leafy village in Cheshire but I can't afford to based upon my (not exactly low) salary. Are the government guilty of social clearance? Of course not. The same choices must apply to those on benefits.

It's simply bizarre to suggest that the taxpayer should fund unlimited amounts of housing benefits to ensure the poor can live in an area where the average taxpayer cannot.

Can we stop talking about Tax Credits as "benefits" please. Benefits are set up as a safety net. Tax credits are completely different and were set up to help boost low wages paid by employers.....it was supposed to make getting back to work easier. They were not set up as "benefits" and therefore people could quite rightly take them into account when planning their families.

Things have changed recently but to dismiss people losing tax credits as feckless for "not checking if they could afford another baby" is plain nasty. Likelihood is people DID check that they would still manage, taking into account everything including tax credits.

Oh dear niceguy. I think that those forced to move out of their homes will find the situation somewhat 'emotive'.

Do they all have the 'choice' to move up north, where there is cheap rent but no jobs whatever?

If they had 3 kids in a time they were employed and can now only afford a 1 bed flat in the entirety of the South East, that's just 'tough sh*t' is it?

I asked a genuine question politely, and I find your sneery, superior reply pretty typical.

We do not all agree with your 'commonsense' household-budgeting metaphors. They are far too simplistic to apply to a country which has f*ed up massively in so many ways- not only in terms of bailing out low-paying employers by subsidising wages, but in terms of allowing a massive property boom to place certain 'undeserving' people out of poverty entirely (particularly the generation over 50 who have seen their mortgages paid off).

There are many other undeserved rewards being smugly sat on in this country. The ludicrous salaries of lawyers and the failures of multiple corporations to pay more than 0.1% tax.

A 'property consultant' acquaintance of mine brags openly about how he avoids paying tax. His riches are pretty unjust as far as I'm concerned. Care to have a good sneer at him too?

But I don't see you calling all that 'bizarre'. Your morality is narrow, and pretty pointless in the shite situation the country is in- unless you think the country will benefit from telling everyone except the rich off a lot for their 'bad choices'.

Most of the population are going to get a lot less rich in the future just as the population of the US (where welfare reform is 15 years ahead of ours) is rapidly hitting the skids. So in future, everyone's choices are going to get restricted and do excuse me if I don't find that an appealing prospect.

The narrow, individualised morality you rely on (ie, do ONLY what you can afford and shut up about the fact that that will stop you living in more than one room/having children etc) is not going to work probably in your own lifetime. because probably 70% of the population will end up 'poor' by current standards in 2040. We're heading toward the situation in many Asian and Latin American economies: 10% rich, 20% 'middle' class (mostly skilled service class for multinational business and the rich, eg business lawyers, private doctors), possible 10% skilled-service sector such as tutors for rich kids, heads of select boarding schools, etc probably earning less then they do now: and the rest right in the sh*t.

You may even end up in that yourself, niceguy, particularly if you are silly enough to become ill at any point in your life (and don't make me laugh by suggesting insurance is going to protect you). I guess that's tough and not the goverment's problem at all.

Nice guy I'm fully aware of what you've just explained to me, common knowledge yes? but that didn't answer my question.

If people have to rely on money from the state to subsidies (is that spelling even correct, mac says so) their living then it's obvious they can't afford things, so why have more children?

I have no answers to what we can do now, because we shouldn't just suddenly take money away, how can we without leaving people (most importantly children) in poverty.

Interesting how I can't claim tax credits because I'm under 25, but have the same outgoings as all my friends who are older. I'm expected to cope.

Jakebullet the definition of feckless has now expanded as per niceguy's post not only to people who claimed their entitlement to tax credit and dared to reproduce in the process, but to those who have claimed topups for a grossly oversubsidised rental market which is taking advantage of those unable to purchase property because its value (particularly in the SE) has been artificially propped up by a series of governments.

Rents are spiralling in Kent, for example, atm but the housing market has flatlined, particularly for the type of flats less affluent buyers want to buy. But they are someone's 'investment' so prices cannot be allowed to drop. Will be interested to see what happens there.

The situation in London is different. Even my 2008 doomed purchase with ex H has gained 150k or so in value since then due to being in a 'hot spot'

When you are effectively saying as the Right now overwhelmingly seem to be, that people in their 30s unable to afford housing although they BOTH work as is often the case in London, are not 'entitled' to have even ONE child- that should give even Tories pause. I'm amazed it doesn't.

I have no clue what Tax Credits have been doing this year, but something is rotten in Nottingham

I moved in with DP last year, from August onwards we had a joint claim that included his wages and the 3 DC. Before August, I was a single parent of 2 DC on benefits. I have had a letter through telling me they overpaid me by £240 last year, on that part from before August. So, when I was claiming benefits then? When I had no income other than what the state provided and no variation in that to create an overpayment situation? Howsat then?

Jake bullet of course tax credits are benefits. Of course people shouldn't have considered them income when planning their families. Are you not aware hat governments and policies change.

Of course people are entitled to have a child, they are not necessarily entitled to ave the state fund that choice. Why is that so hard to grasp?

That's all very well but because tax credits were introduced (amongst other things) its pushed prices up dramatically.
Give everyone a hundred pounds extra, mr shop/LL will think oh I can charge an extra hundred pound because they can afford it.

Inflation was actually very low for many years, the problem was people became accustomed to a certain kind of lifestyle that they mistakenly thoughtyhe could afford. Now people are finding out what they can actuall afford and they don't like it.

" spicandspan Tue 23-Oct-12 17:09:48

I get no contribution to childcare from tax credits at the mo, because I only work 7hrs per week. My dh works full time.how many hours do I have to work for tc to contribute towards childcare costs? And how does the contribution work - do they pay a % of the actual costs, or a flat rate? "

Say your DH works full time at minimum wage, and you work 16 hours.

37.5 x £6.19 = £232.12
16 x £6.19 = £99.04

Total income: £331.16 per week; £17222 per year.

If you spend £300 per week on childcare, and you have 2 children, the maximum award including childcare is £21505, which is made up of:

£4660 Working Tax Credits
£10920 Childcare tax Credits
£5925 Child Tax Credits

The 'withdrawl' is 41% of the difference between the threshold (£6420) and your Total Income (£17222), so it's 41% of £10802 = £4428.82

So, your Tax Credits would be:

£4660 - £4428.82 = £231.18 Working Tax Credit
£10920 Childcare tax credits
£5925 Child Tax Credits

Total tax credits: £17076.18 per year

Don't forget though, that you'd be paying £15600 in childcare, so in effect you'd be only getting £1476.18 in tax credits after the cost of childcare is taken into account.