Working tax credit not taking into account my earnings???

[Billyjoe10]

Went self employed recently and applied for working tax credit they asked roughly how much I expected to earn and I told them an estimate. They then gave me an award notice of what they will top up with but say they are not taking into account my earnings at all until next April. Doesn't this mean that I will be overpaid massively come next April?

Are they taking into account any sort of figure?

I've been on tax credits since 2014 and every renewal period is always horrendously stressful.

This year has been the worst as they have reduced my award massively as I need to declare my pension contributions which I can only do when the renewal pack arrives.

Yesterday I went into abit of a panic as they reduced them again, so twice in the space of 3 weeks without any reason why. I got really upset because I really cannot afford to lose money each month, but at the moment there is nothing I can do. But it's basically telling them that I've been overpaid by alot!

So I went through all my award notices (I've kept them all), the most important ones being the final award Notices and I discovered that every year that haven't used my actual earned income but a higher amount.

I pay into a pension that is taken after tax and national insurance so they should not include this contribution as income but they have.

I'm disappointed really as it makes a huge difference. Every year I have provided proof of my pension payments and declared my earned income for them to still use a higher amount.

I hope they have estimated your award on a fair income close to what you have provided

Yes that sounds typical of them, everyone seems to have this problem. But no they are not taking into account any of my earnings... Even though I gave them a rough estimate on the phone which they have noted and turned out to be pretty accurate so I was hoping they'd get my award fairly close to right. I'll have to phone them up then won't I or I just know next yr will be horrendous as I'll be overpaid 5k plus!!!

Tax credits awards are based on your earnings for the last financial year. Are you earning significantly more this year? There is a disregard where your earnings have increased by less than £2500, but anything more than that and you'll have an overpayment next year.

In theory universal credit overcomes this problem through real time reporting, but your entitlement is likely to be less on UC and it rarely works well for the self employed.

Sorry, not very positive!

I've always been told if your income is more than 2500 or less than 2500 than last years earnings they can base it on an estimate. My first year of claiming for them, my income dropped by over 10k, so they based that year on my estimate and was actually owed at the end following the declaration

You can phone them and ask them to do an 'in-year assessment of earnings' - you have to specifically ask for it, but it means that they take your estimated income from this year and work with that. The only issue is if your estimate is wildly out, you'll have an under/overpayment to sort out.

Thanks I will ring them and ask.