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Original poster

"Generous" tax credit payments - help please

29 replies

reddaisy · 27/10/2010 14:08

Our tax credit award have just been calculated and I have been told we will be receiving more than £700 a month.

But it seems very generous. DP and I live together, we both work (I work four days a week) and childcare costs are £120 a week on average for our one DD. Our combined income is around £47,000. But I was on maternity leave and DP was out of work in the 2009/2010 period when the payments seem to be for.

They assure me the award is correct but it seems rather generous and I'm worried that we will suddenly have to pay back money.

Any advice would be very gratefully received.

OP posts:

Chil1234 · 27/10/2010 15:06

Tax credit awards for 2010/11 are based on your earnings in 2009/10. Child tax credits for households earning more than £40,000 will stop all together in Jan 2011 so your April 2011 recalculation will mean you qualify for very little, if anything at all

I'd suggest taking the money on face value but spend moderately & bump up your savings. When you get your 2011 award, if there is anything to be paid back, you'll have it to hand. If you don't owe them anything you'll have a nice nest-egg for a rainy day.

Original poster

reddaisy · 27/10/2010 15:09

Thanks Chil. I didn't realise tax credits were going for joint income of £40k. I thought that was for main earner?

Do you know if there is anything I can do to check the amount is right?

OP posts:

greaseistheword · 27/10/2010 15:12

i would contact them to double check.we had "generous" awards for 2 years and thought it must be right they cant get it wrong twice but it now turns out they were wrong and we have to pay back around £7000.

HappyMummyOfOne · 27/10/2010 15:12

What was your income in the previous tax year?

louii · 27/10/2010 15:13

Based on previous year so probably correct.
I have been on Maternity leave this year so should get more tax credits from next April.

Chil1234 · 27/10/2010 15:16

There are tax credit calculators online... Tax Credit Calculator

Chil1234 · 27/10/2010 15:18

Child Benefit is going in 2013 for households where one or more wage-earner is a higher rate tax-payer (£44k+) But Child Tax Credit changes from Jan 1 2011 were announced in the last budget and these affect households with an income over £40,000.

EvilAllenPoe · 27/10/2010 15:20

if you have phoned them and made sure they are aware of your current forecast income for this year, then get the name of the person you speak to, and ask then straight out if you would be asked to repay any based on that forecast income.

it seems very large, and you would probably be expected to pay most of it back at the end of this year if it is wrong.

MaMoTTaT · 27/10/2010 15:24

that HRMC calculator is pretty dodgy, I would have hoped they'd improved it but apparently not

entitledto tends to give more accurate results ime

bumpybecky · 27/10/2010 15:27

agree with MaMo - the HMRC one gives about half the value of CTC for us, their letters and the entitledto one both have the same much higher amount

DaisySteiner · 27/10/2010 18:25

It's based on last year unless your income in the current year has increased than more than 25,000 GBP. If it has, they will work it out on your income for the current year minus 25,000.

Original poster

reddaisy · 27/10/2010 20:33

Greaseistheword - Did they suddenly decide you owe them £10k? That is what I don't want to happen.

Good advice about getting name from call centre etc, all the details on the form were correct as I took AGES over them to make sure they were right.

It is ridiculous that when I was on ML and DP was out of work for several months we got hardly anything and now we are both back working we get far more.

I think our combined income for that period was 24k.

The system is so complicated that it makes me so nervous.

Their calculator comes up with roughly £500 so I will try entitledto.

OP posts:

StewieGriffinsMom · 27/10/2010 20:38

This reply has been deleted

Message withdrawn at poster's request.

Original poster

reddaisy · 27/10/2010 20:49

That's what DH wants to do with it and I think it is what we will do. I just feel very uncomfortable about it.

I reckon if I have supplied the right information, queried the amount and still get the money then we should get to keep it Can't see that we can do anything else

OP posts:

EricNorthmansMistress · 27/10/2010 20:56

It's correct! I had this worry this butlast year our income was low due to mat leave and it's definitely right.

StewieGriffinsMom · 27/10/2010 20:58

This reply has been deleted

Message withdrawn at poster's request.

Original poster

reddaisy · 27/10/2010 21:07

Things are tight at the moment but we are getting by but last year was AWFUL and I was in tears about money when DP was looking for work and I was on ML.

It is all back to front.

OP posts:

StewieGriffinsMom · 27/10/2010 21:16

This reply has been deleted

Message withdrawn at poster's request.

Original poster

reddaisy · 27/10/2010 21:38

That's the problem. A lot of the changes are verbal so you can't prove what you have said etc to someone in a call centre.

And they all say different things when I have rung in the past.

DDs nursery fees are going up £20 a month next month, but if I tell them they will probably give me another £1k to cover it!

OP posts:

chocolatespiders · 27/10/2010 21:46

I earn 14,000 a year as a single parent and get £400 a month with no childcare costs.

so i think it is wrong but i could be wrong

EricNorthmansMistress · 27/10/2010 21:48

chocolate - childcare will account for much of it, and they are basing it on their income for last year, not on 47k.

Original poster

reddaisy · 27/10/2010 21:52

Childcare does make up the bulk of it chocolate.

OP posts:

TheGhostlyPirate · 27/10/2010 21:54

I earn around 14,000 a year and get around £220 a month but also an extra bit on top as DS gets DLA plus working tax credit of £50 a month. I think nearly £700 a month sounds a huge amount BUT you are obviously getting some childcare help with that so could well be right.

HappyMummyOfOne · 28/10/2010 00:44

In April, the disregard of previous income changes to £10k (5k the year after). As you will have earnt £23k more than the tax credits your award is based on you could be left with a huge overpayment.

DaisySteiner · 28/10/2010 09:18

Yes, but in April the disregard will apply to awards for the 2011-12 period, not this current year.

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