Tax credits and covid

[EvenMoreWorriedAboutMoney]

So I have been on tax credits for a couple of years, single parent with school age children, I work(ed) part time. My tax credits are based on working a mimimum of 16 hours a week...but I havent done that since March. I've kept on hoping a job would come along, have made so many applications and just not got anything, telling myself that given I'm allowed to average out the hours I work so to speak, that it would be fine in the end. And now we are going into lockdown again. What do I do? I assume I will have to go onto universal credit...I will be very very much worse off if I do. But I cant keep ignoring this problem. Can anyone advise? ( Incidentally I have worked all my life, never claimed a thing until my divorce.)

Ooops just realised Im on AIBU...

Are you still employed, OP?

If you're still employed and have had your hours reduced or been furloughed because of Covid, your TC entitlement will be unchanged. The 16 hour pw threshold has been suspended for such cases.

If your job has come to an end, then you are no longer entitled to the working tax credit part of your tax credits and are likely to have been overpaid. If this is the case, you really ought to ring them first thing on Monday and tell them.

Hope that helps.

Sorry, forgot to answer the second part.

You may not have to go on to UC, if you have paid sufficient NI contributions over the previous 2 years (tax years 2017/18 and 2018/19) to qualify for "New-style JSA". You could claim "New-style JSA" of £74.35 pw, still get child tax credits and you would qualify for full housing benefit up to the maximum LHA rate for the size of property you are entitled to (providing that you are already claiming housing benefit, you can't start a new claim for HB if you're not already getting it).

However, you might be better off on UC anyway, it would be worth checking on one of the online calculators (turn2us or entitled to).

You can also check online if you're entitled to "New-style JSA".

If you get PIP, you'll stay on the old benefits, for now at least.

Thanks for the reply. I am (was) self employed...I work with children across year groups so was a bubble burster and have yet to be called back by the schools I worked for. I dont know when I will be. The problem with UC is that I have some savings from my divorce settelmtn that render me ineligible for UC but not TC. Im fucked I fear.

www.gov.uk/government/news/tax-credits-customers-will-continue-to-receive-payments-even-if-working-fewer-hours-due-to-covid-19

I found this a few months ago when I had the same issue. It seems to say that tax credits won’t be affected?

If you're self-employed, that makes a huge difference. Time spent working on building your business still counts, even though it doesn't necessarily produce an income.

I'm not very up on it as it's not something that really crops up with my client group, but I had to look it up a couple of years ago for an artist who was on WTC. Basically, they just took his word for it with regard to hours. They did the same with my BIL, too, who was persuaded to start a business when they were desperately trying to get people off JSA. I doubt if he did more than 16 hours a year, never mind a week.

Thank you so so much for all of your the replies, that has really lifted a weight off my shoulders...Strawberry I hadn't come across the info in that link so thank you!! I'm so relieved I could cry.

Are you claiming working tax credit but not working? You will have to pay all that back.

Thanks for the supportive reply OneRing but if you look at the link Strawberry supplied you are wrong

That link says The government has confirmed that people who can’t work their normal hours because of coronavirus (COVID-19) will still receive their usual tax credits payments.

Those working reduced hours due to coronavirus or those being furloughed by their employer will not have their tax credits payments affected if they are still employed or self-employed.

These customers do not need to contact HMRC about this change. We will treat customers as working their normal hours until the Job Retention Scheme closes, even if they are not using the scheme.

We’ll use the information we hold about the number of hours they normally work.

As LakieLady says, time spent working on building your business still counts, even though it doesn't necessarily produce an income.

I would spend this time thinking about how you could use your expertise to deliver classes online. Perhaps look at websites like outschool.com/ and think about whether you could offer classes through them.

And you could look into making a basic website to advertise your work, for when life returns to enough normality to allow or now if you can deliver something from home.

Also look into how to run a business through Facebook - how much ads cost and how it works, that kind of thing. (You can be really targeted about them).

Even if you don't eventually go for it, even doing that research in is still counted as work if you're self-employed.

If you're doing no work at all then your work could be seen to have ended. But if you're still trying to make your business work (even if you're a sole-trader) then you're still working, albeit reduced hours.

And, you never know, your research could bring you a new source of employment / income.

Lots of people are having to change what they do because of covid. What if the schools don't invite you back in for a couple of years? Start planning now and think how you might offer what you do online, even if in a very different format.

Schools may be being kept open but all the school clubs are closed round here. My kids have just gone off to do their sports clubs for the last time for goodness knows how long.

If you could offer some kind of activity online of the lockdown period that could be very popular.

I claimed tax credits on zero taxable income as a student and didn't have to switch. I don't think you can make new claims for housing benefit though unless you already claim it.

Op did you apply for the previous 2 self employed grants offered due to Covid?

This is the time for using your savings, personally think if you have savings you use them before claiming benefits.

SBTLove...tax credits dont require me to spend savings, in fact I am part of a tax credits savings scheme thro HMRC, so I would be stupid to do that if I dont have to

needanewidea....I do forest school so online doesnt work unfortunately. You would have thought being outside would be perfect for covid times but the schools I worked in used me across age groups so I guess Im a bubble burster. I have indded been plotting and planning other ideas, working with adults etc, just nothing has come to fruition. I have given up on forest school for now and Im applying for all sorts....I do actually have an interview for a driving job ollecting covid samples next week, seems like thats the current growth area

Do you not think it’s morally wrong to be wanting to claim UC but be sitting on savings? I just don’t agree with receiving state support when you have £1000s in savings. There are ppl with nothing waiting 5/8 weeks on UC relying on food banks and you have money available to you, use that!
Sorry that’s my opinion.

SBTLove....I haven't said I want to claim UC? I specifically said I dont want to claim UC because it would take my savings into account and I probably wouldnt get it. I do get what you're saying, yes there are people worse off than me; but this is one of the (many) criticisms of UC over tax credits, that it insists that people be absolutely screwed into the ground before helping them. No, I don't agree with that.

I don’t think anyone with £1000s in savings should be claiming benefits.

Sunnydays...I wasnt eligible for the grant since it was calculated based on tax year 2018/19. I earnt a lot more before I got divorced, Im now prt time for childcare reasons.

You can have savings with UC but the lower limit is £6k. For a lot of people that's a huge amount in savings so not exactly run into the ground at all.

Wegetthejobdone...yes, for many people £6k is a lot. But I think you are wrong, £6k does not keep you far from penury if you have a family.

A vast majority don’t have £6k savings and live month by month and UC is an essential need in these times. Use savings first before claiming anything.

Ignore the posts on savings, the savings threshold is higher with tax credits than UC

OP not sure if this is what you are doing already but there is a help to save scheme which is good, they add £25 to every £50 for people on TC or UC

www.gov.uk/get-help-savings-low-income

Not sure why people chip in with random unhelpful opinions which if followed, could mean people don't claim what they are entitled to

As a taxpayer I’m more than happy for OP to be getting wtc while retaining savings. £6k a year is only a couple of months running costs for many families (and not even that for many areas in the SE). I don’t want her or others like her to be made financially insecure, that won’t help anybody in the longer term.

Did you never hear this joke SBTLove?

A banker, a benefit scrounger and a Daily Mail reader were sitting around a table, on which was a plate of 10 biscuits. The banker reached over and took nine biscuits and then turned to the Daily Mail reader and said, “I’d watch out if I was you, that scrounger is after your biscuit”.

Please don’t fall for the divide and rule bullshit our lords and masters successfully promote in the tabloids. It’s for their benefit that you believe it, not yours. Let’s focus our attention on who really causes the problems of inequality, not get all envious about someone just one rung up from ourselves who is by no means wealthy.

Orangeblossom77...yes that is what I do. Its a really good scheme.

Thanks Orange and Tolles for the supportive comments. Why SBT would turn her/his nose up at claiming if it is perfectly legal to do so I have no idea. I can only assume they have never been in the position of needing to. Anyway, I am retiring from the thread since it has gone rather off topic!

Op has paid into the system and is applying for benefits that she’s legally entitled to. If you have a problem with that @SBTLove, take it up with the government! Single parents have been completely unsupported throughout covid and have far more financial challenges than most. I kindly suggest you keep your sanctimonious opinions to yourself!

Op glad you’ve managed to get the info you need. I’d avoid UC for as long as you possibly can.