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Ex husband and Tax credits?

31 replies

Lilaloves · 01/03/2015 11:14

Hi,Can anyone help me out here?

I am separated and in process of divorcing.I am a sahm to two dc.Ex husband is self employed/Sole trader.
At solicitors meeting it was requested that I look into claiming benefit as have never received any benefits apart from standard child benefits.

Looks like I am going to receive £400 in tax credits.At second solicitors meeting they are now saying I will have to accept a lower offer in monthly spousal support from exdh as I am now better off due to the tax credits.I really don't see why I should have to receive benefits if exdh can afford to pay?

Exdh is also claiming he only earns 30 thousand a year,which I very much doubt,but as he is self employed he can pay himself a very low salary to keep money within his business.

So my question,if he maintains he earns a low income can I not request he claims benefit also? Would he be eligible? Earing 30 thousand a year?
Thanks

OP posts:
vickibee · 02/03/2015 12:09

If he is SE he is the business, the business has no separate legal identity so he cannot pay himself a salary. All his sales are his income. Only if it is a limited comapny can he pay hinself a salary and retain money within the business.

lilaloves · 02/03/2015 18:36

Vickibee- So as a sole trader is it his total yearly sales or his yearly profit that any maintenance to me will be calculated on and not his yearly salary?

OP posts:
bobs123 · 03/03/2015 09:36

I would guess it would be his net profit that would be used if you look at it logically

Is he a limited company? If so, as has already been said, this is different (and of course all his accounts will be registered at companies house)

kilmuir · 03/03/2015 09:40

if he can pay he should, why is it down to the tax payer

vickibee · 03/03/2015 10:45

it will be net profit (sales less business xps) which of course can be manipulated

bobs123 · 03/03/2015 11:34

But he will also have to show previous years accounts (3 years approx) which will give a balanced view and flag up if profits suddenly drop drastically.

lila it makes no difference to the tax payer how much spousal is paid - the tax credits would still be the same amount

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