CTC changes at £25k pa in future years

[LimaCharlie]

according to this report

This should probably have gone in one of the budget threads but it may have got lost - like the information managed to get lost in the budget announcement.

We were breathing a sigh of relief at yesterdays announcement that it was from £40k but actually this report shows we'll be affected in the not too distant future

[panic]

Panic here too. Although Ive just read the report and its not clear whether its £25k or £30k. Cant really understand it. Does it depend on how many children you have as to whether your allowed to earn £25k or £30k ??

There is another short thread about this here

Thanks Slushy I hadn't seen that one - seems very underhand that they went with a headline in the budget when the reality is very different

I really struggle to understand all this - our first child is due in 3 weeks, so i never understood it to start with! We're on about 50k combined, but the way i understand it once you're on over about 40k as a couple, you're better claiming leapfrog vouchers rather than the tax credits, so it wouldn't make a difference?

Is that not right?

But still, after reading that, I'm still not entirely sure whether ours will be cut or not. We will be just slightly (by around £700) over the £30k threshold, but, that table on the link you provided based it on one child. We have 3 dc, and we receive the disability element for one of them. Does that mean we will still be eligible for some ctc or will it all go because we will be over the £30k income.

Really hope someone here can answer this for me.

I think it means that if you ONLY get the family element (£545 a year) then you will loose it when the changes apply. IF you get the child element (extra money on top of the 'family' element) then you will keep it until your income exceeds the child tax eligibility threshold.

It is very roughly around 23-25K for one child and 30K for 2 kids and 5K per child after that. So to still get the child elements over £30-35K you would probably have to have at least 3 kids. (have yet to find a table for larger families but using the TC calculator can tell you a fair bit). It seems very like what the Lib Dems were suggesting in their manifesto.

The thresholds will also be reduced so that less people will qualify and those that do will get reduced rates as their income rises. Basically, everyone over average wage will get reduced TC in the future.

table at bottom

I would think that with 3 DC you would still get some child elements at 30K by looking at above table (bottom of linked page).

Forgive me if Im wrong and please correct me, but isnt that table for this tax year though. I thought the budget announcements were for next tax year (2011/2012) and future?

I too am in the same boat, 2 children one of which we get DLA for therefore the extra CTC.

yes it is but it gives you a rough guide as to whether you would get the child element. If you get that now it is likely to continue. There is a table in the budget book but I don't think it shows if you have two children, three children etc.