TAX CREDITS REMOVED, HELP ME PLEASE!!

[TreeHuggerMum1]

Hi please help.
I son is 2 ands half and I went back to work when he was 5 months old. Started slowly on 2 days then rose to 3 after he was one and upped it to 4 days last year. Tax credits were informed of every little thing and until last week all was great. I was getting 87 a week tax credits which I used for his childcare.
I filled out my renewal exactly as I should and they have now removed all but 10 pounds a week of my award. I have phoned and they say this is correct but I cannot see they could possibly remove all that.
Apparently my wage has gone up (21p per hr) and I earned more last year than the year before so they are basing next years on that figure.
I am questioning now if its worth my working four days away from my son if I am getting no help and losing over half my wages to chilcare costs.
I am gutted and confused as to what I should do.
Please help, any advice taken gladly.
Thanks.

You are probably best off working 16 hours a week that way you may still qualify for childcare help and most of your salary will not be taxed either. Go their website and play around with figures.

For me I worked out we will only ever be £50 per week better off if I work 16 hours per week so we decided it wasn't worth it (we have 4 dc though)

Presumably 4 days is more than 16 hours ? Do you get WFTC and it is CTC that have been cut ? When he turns 3 you can claim the LEA vouchers to offset against up to 12.5 hrs pw (and I think this is increasing next year) of Preschool education costs so it might be worth holding out until then.

Its the CTC they have removed. Hes not entitled to the 12 hours til Jan 09 so a very long time to wait.

presumably they have overpaid you and are now claiming it back? check on line what you should be getting and like I said play about with figures.

to get full tax credits i mean child and working tax credit you should work between 16 and 30 hours a week not more not less.I work 16 sometimes 24 and I get 102 pounds a week.getting paid 6.38 ph.

Your tax credits are always based on your previous years income unless you expect to earn less than that figure. Within a tax year your income is allowed to increase by £25,000 from the previous year without it affecting the amount you get but once you get to the new tax year the increase is then taken into account for the coming year and your tax credits adjusted accordingly.

The idea is that you are allowed to get the benefit of your wage increase for the first year before it affects your tax credits. Unfortunately this means it's very difficult to know your true income! As a general rule 39% of any pay increase is then taken off your child tax credit, and of course about 31% is taken off in tax so you only see the remaining 30%.

if you are a single parent working 30 hrs or more, then you can clain back most of your registered childcare fees with the childcare credit - if you are in a couple then both of you have to be working

Have they got your childcare costs down too?

I work 28 hours a week and my husband 40. Childcare averages 100 - 110 per week give or take. They have all the relevant info.
I worked alot of overtime last year as we moved in Jan and needed the extra to get a higher mortgage for the house, they say that I earned too much last year and have reduced it this year accordingly.
I either cut my hours and try and see if they'll give me more that way or I can increase my overtime to try and cover the additional costs of childcare.
Hard to know what to do for the best.

£10 a week is basic CTC and so your joint income must have gone over the limit for additional help.

If you cut your hours, they will still base it on last years figures so you wont see any benefit until next April.

It depends on how close you are to the threashold for basic tax credits as to how you should proceed, dropping hours may work for a short time but another pay rise could put you back in this position again.

If you expect your income to be less this year because of doing less overtime, then you can phone and tell them the figure you expect to earn and they may increase the amount you get, depending on whether you're still over the limit for the basic amount (£10 a week) Be warned though that if you underestimate your income then they will ask you to repay and extra tax credits you got as a result.

Fiddle witht he figures at entitledto.co.uk or is it com? And see what works out best