Set up a business in May this year. This involved offering free introductory sessions, lots of leafletting/advertising and a lot of research. I had to put my DC in part time childcare and claimed childcare and normal tax credits for this. The business was registered with HMRC. had a website, business cards, business phone line, directory enquiries listing etc.
Two months in, I was asked to provide proof of my self employment in terms of advertising, breakdown of hours worked etc. I supplied proof of everything they asked but they decided that I was entitled to working tax credits as I was not 'working in expectation of payment' as I had not yet produced any income. The letter stated this with no explanation as to how they had reached this decision. I spoke to the compliance officer who decided this and she would not explain, just said I could appeal. I had to immediately give notice to the nursery but pay the months notice which left me a lot out of pocket!
I was told an appeal would take between 4-6 months to reach a decision! I went to my local MP and he said he would help. 6 weeks later, he sends me a letter enclosing an appeal form from HMRC saying that they have said I should appeal, well that was why I asked the bloody MP to step in so I did'nt have to wait 4-6 months for an appeal!!!
I am at my wits end! I should have been allowed more than 2 months to make some money surely. When I first out the claim in, I was told they would base my claim on what I would earn over the whole year and at no point said that I had to generate income immediately. Can anyone advise me on this?