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Change in Tax Credits


mina2974
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Hi

 

I have been trying to work out how the change in tax credits announced in the emergency budget will affect us ,

 

We are safe from the new 40k lI'mit but im not sure how the new income limits are going to affect us?

 

At the moment the income allowance is 25,000, this will go down to ten thousand and then to 5 thousand , does this mean we will lose an equivalent amount of tax credits ?

 

If this is the case then we really need to think about selling our house as soon as possible or we will not be able to meet mortgage payments, I was working full time when we brought our house but have two disabled children on of which is only at school part time and one is not attending at all after a suicide attempt :(

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Hello there. I don't know the exact answer I'm afraid, because this is all so new. I would be looking online for information, maybe the newspapers' websites, the BBC, HMRC if they've caught up.

 

If I spot anything later, I'll post it to your thread.

 

HB

Illegitimi non carborundum

 

 

 

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Thank you HB, I have read everything I can get my hands on to find out how the change will affect lower income families but there seems to be no mention of this anywhere,

 

If my worst fears are correct then this is the change in tax credits that is going to affect everyone that works the most :(

 

Our household income is only 13k a year, at the moment none of it is taken into account in the tax credit calculation, when the limit drops to ten thousand 3k of it will be taken into account and when it drops to 5k a year 7k will be taken into account, if we lose that much in tax credits there is no way that we would survive :(

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Try here mina:

2010 Budget - HM Treasury

I'm not a qualified welfare rights adviser, but I'm planning on becoming one. I'm no substitute for more competent advice from trained CAB and welfare rights workers - [URL="http://www.consumeractiongroup.co.uk/forum/benefits-tax-credits-minimum/127741-benefits-advice.html"]see this post[/URL] by Joa, great advice and links! I've been running a Crisis Loan campaign and help since Jan 2007 . See my annotations c/o "theyworkforyou". I'm also currently interested by the recent DWP Medical Services reform and the effect this is having on valid claims, seriously - someone needs to be keeping a suicide count.

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  • 1 month later...

Hi Mina,

 

No that is not what you will lose.

 

What the current £25000 and the new 5k and 10k etc relate to is called 'income disregard'.

 

Currently your household income is allowed to increase up to £25000 more than last years income without you incurring an overpayment ( ie, last yrs income was £17000, this years payment will be based on an income of £17000 but you are actually allowed to earn £42000 this year without it resulting in an overpayment).

 

What the new Budget has done is, from April 2011/2012, reduced this 'disregard' bit by bit.

 

If your household ususally earns a similar amount every year it shouldnt really affect you.

 

Hope this helps, Anne

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