HMRC - loss of tax free childcare and working parent hours

[DiddlyD]

I have a 4.5 and 2.5 year old, my partner and I both work full time. We’ve used the tax free childcare allowance to get 20% off our nursery costs and more recently the working parent hours for both. I recently reconfirmed and was asked to provide evidence of my partners earnings to show we were still eligible for both. We did this via three months worth of bank statements to prove earnings. He is self employed so gets paid into his business account then transfers his wage to his personal account - leaving his money for tax in his business account. Mid May to mid August demonstrated over £2.5K which is the minimum for receiving the funding. I’ve just received notification that HMRC do not feel he will earn the same amount from July to October and therefore all support has ceased?!! I’m so confused as we demonstrated what was requested so how can they predict it will not continue?! I have friends who don’t even put their partners on the application for fear of going over the threshold for joint earnings (which we wouldn’t hit) so I feel we’re being penalised for being honest. Also, we provided evidence to support the request. Going to appeal it but wanted to know if anyone has had similar issues and how they dealt with it.

I’ve had loads of trouble with a similar thing, I’ve been paying full fees now for 18 months. I’ve had to reduce DD hours since she’s gone back in September. I did appeal and got nowhere.

Sorry are you sure there is a threshold for joint earnings? I thought you got the tax free childcare / 30 hours if individually you both work the minimum number of hours a week, and individually neither of you earn over 100k adjusted net income a year?

I mean - step one, go back and say he will (can you provide evidence, given it’s already mid-September).

But - he’s working full time and being paid <£200 a week? As that’s what the numbers seem to suggest.

There is no joint income threshold - it’s based on individual incomes.

Is the nature of his work seasonal? Is this why they think he won’t earn the same at the end of the summer?

The minimum is £2539.68 over 3 months.

Are the earnings steady? Or is income spiky?

Full-time but earning £200 a week? Your childcare must cost more than that, your partner should be at home with the children if that’s genuinely what he’s earning,

Over the next 3 months you and your partner (if you have one) must each expect to earn at least:

• £2,539.68 before tax if you’re aged 21 or over (equivalent to £195.36 per week)

This is for the tax free child care which we’ve demonstrated through his bank statements, earning over this in the three months provided. And yes apologies, no joint threshold but neither will be earning £100k (sadly!)

Apologies yes, no joint threshold but neither would earn £100k!

I didn’t say he earned £200 a week?! Only that what evidence we provided proves he earns over this - £200 per week is the minimum you need to earn to receive support which is in line with minimum wage.

Sorry - I misunderstood - I thought you meant that WAS what he earned.

How strange then. If he is clearly earning more then definitely appeal. So bloody weird.

No, he’s self employed so it’s a bit up and down but ultimately earns a good wage.

Self employed and inevitably some months better than others but ultimately a decent wage. Maybe they have a crystal ball!!

I’m sorry to hear that. What a complete joke.

Have exactly the same issue, except my eldest is 11 so have had it for years :(( DH is self-employed but his earnings are pretty stable - comfortably between the lower and upper thresholds. We are in a constant cycle of applying / reconfirming / 50-50 whether it gets rejected or not / 50-50 whether the appeal succeeds / reapplying.
It is exhausting, and means we can't rely on the funding at all. When it does go through, we treat it as a bonus.
It's such a shit system, in the 8-9ish years DH's income has always been within the limit but they just seem to deny it on a whim and there is basically nothing you can do....

My Husbands self employed too - steadyish over the year, always over minumum and under max. Had this message twice. First time appealed and they restarted both, second time had to reapply but luckily not paid in full for longer than 2 months.
If your appeal is rejected just reapply as soon as you can - we gave no different evidence but application was approved.

So he's paying himself as an employee absolutely bare minimum to leave the rest to claim as dividend at lower tax rate?