Confused about tax credits

[FelixFelix]

I'm hoping someone can help me

I've recently given up work following maternity leave (was on stat pay) as childcare costs would almost amount to my monthly wage so we decided it was worth me becoming a SAHM and spending time with our dd.

I have received the form to apply for tax credits but I'm really confused by the system. I've done two different tax calculators - entitled.to estimates we would be entitled to approximately £20 tax credits per week, but the HMRC one estimates we wouldn't be entitled to anything. I've noticed the entitled.to calculator takes in to account your earnings for the current year, as well as the previous year where the HMRC calculator doesn't ask for the current years earnings. Our household income is going to drop significantly for 2014/15 compared to 2013/14 due to the loss of my wage - do tax credits take this in to account or is it all solely based on the previous years earnings? I've read something about an initial then final award but I really don't understand it. Do I send off the form and they calculate from last years earnings then I have to call them again and advise our income will be significantly lower for 2014/15?

It's so complicated! I'd be very grateful if someone could explain it to me, as I've never really claimed anything like this before

Tax credits are based on the previous tax-year's income. However if your current income is significantly higher or lower, HMRC will use that instead. So submit the form using data from the last tax year and then contact HMRC directly when you get the initial reward to tell them about your change in circumstances.

They have to drop by 2k or more for them to take it into account.

If you're no longer working it will be taken into account when you apply even though it goes by last years earnings.

I think there's something in the notes book that comes with the form about what to enter for your earnings if no longer working. If not the best thing would be to ring the helpline and ask what to put on.

If you use the calculator to get an estimate then only put your partners earnings in and leave yours blank as you're no longer earning.

That's great, thank you for the replies. They don't make it very clear! I'm less worried now