child tax credits help

[letsgetreadytoramble]

Hi, I recently split up with my partner and need to apply for child tax credits to help with the cost of childcare, but I am massively confused by them. Both myself and my ex receive childcare vouchers from our workplaces. My son is 3 so also gets an educational discount. Am I correct in thinking that I need to deduct the vouchers and educational discount from the weekly childcare payment figure that I provide to HMRC? If so, then that doesn't make sense to me, because I do actually pay money from my salary (as does my ex) toward the childcare in the form of the vouchers ( it's just that it's not taxed)?so it doesn't seem fair to exclude that money from my calculations. I feel like my head is going to explode.

yes. e.g. you earn £1000 and salary exchange £200 for childcare voucher and you actual childcare fee is £500/month.

then the figures to calculate TC will look as follows: £800 (1000-200) as income and £300 (500-200) as childcare.

but as a single parent, I have no idea who your ex partners contribution would count.

also, childcare vouchers are generally good for those on higher incomes.If your income is low and childcare is high you might be better off not using vouchers and getting TC instead. they did a better off calculation for me over the phone years ago. night still do this.

Thanks very much for replying. Have done some calculations and I don't think I'll be entitled to anything. Not really sure how we'll manage to be honest.

once the tax credit changes come in, this will be a question for lots of families sadly

Yes it's correct. Can you get your ex to stop getting vouchers and pay you the difference as maintenance instead. That way nursery fees are "higher" and maintenance is excluded from the calculation.
I was surprised how much I was entitled to as a single parent paying childcare once ex left. Sadly next year will not be so good!

was thinking the same - no vouchers from ex and upping maintanance instead. will change the figures for the TC calculation and should give you more in tc

Thanks very much, I'll give that a go then. The people I've spoken to at HMRC haven't been very nice or very helpful - I guess none of them are in this position but a bit of empathy wouldn't go amiss.

Can I just check one more thing? I claim the full amount of childcare vouchers from work - £243. So, I know I save £80 on those in tax, but the other £163 comes from my salary and is therefore part of my childcare costs. So can I include that money in my calculations of my weekly childcare costs?

if you use vouchers you can only claim tax credit help for the amount that is not covered by vouchers (I.e.the £163)

Ok, thank you.

that is why you may be better off not using the vouchers as you may get more help ona childcare bill of £406 and the amount you get in extra tax credits this way be more than the £80 you are saving in tax.

I used vouchers until I discovered that II would be more than £100 better off in not using them and getting Tax credits instead. vouchers make only sense of you have s pretty good salary. otherwise they leave you worse off.

ignore the typos

But the £163 is vouchers. Op all the vouchers must be deducted from the figure you give hmrc. For example for two dc it's only worth using vouchers to pay for any childcare costs over £300 a week. You can look up the figure for one child.

Ok, thank you. My salary is £30,000 so I probably am better off using the vouchers.

Guess so and I don't think you will get any tax credits tbh at that salary. so vouchers might actually be the way to go.

try this calculator and play with the figures. should give you a good idea which way to go.

taxcredits.hmrc.gov.uk/Qualify/DIQHousehold.aspx

Thanks!

If your income is low enough to get tax credit contributions towards childcare then you will be better off ditching the vouchers and claiming tax credit on the full amount. Disclaimer - this is based on rates 3 years ago and also may not be true come April