Tax credits

[CheshireSplat]

Hi

I'm very fortunate to be well paid, but when on maternity leave I'll be on statutory maternity pay. DH earns about £18,000 a year.

Does anyone know whether we can claim working tax or child tax credits when my pay is reduced because of maternity leave. I've looked on line but I don't really understand! Before I ring anyone or look further, I wondered if maternity leave is not counted for any reason?

Thanks!

Cheshire

SMP is not counted as income so you would need to estimate what your income would be for the tax year. If it is your first child I think the cut off is about £26k, so it would depend what your household income is. You can take off SMP of £100 a week for 39 weeks if taking full mat leave.

You can disregard £100 per week of maternity pay. However, tax credits are based on each complete year of earnings, so if this is your first child you'll only get tax credits if your combined income for this year is less than £26,000 (gross).

If it will be less than £26,000 for this year (April-March) then you'll have to ask for an in-year assessment of earnings because otherwise they'll look at last year's income which might be over the threshold.

Thanks so much Baby and Lougle. That makes sense! Our joint income will be above £26,000 in each of the tax years given the timings of my mat leave. So I'll just have to be grateful that we are well enough off not to qualify.