"We need to check your Tax Credits Claim" HELP!

[moneytalk]

Hi all,

I received a lengthy and involved form to fill in under the title -"We need to check your Tax Credits Claim".

In which every other word was PENALTY, and terms such as 'your Penalty', when I haven't even got one, and as far as I am aware, am doing nothing wrong to receive a penalty. Instantly feels like a document to try to instil FEAR. I am practicing CALM and a feeling of INNOCENCE!

 

I am an artist, working many hours and often barely get by on the WTC I receive . I am grateful for the WTC and in between times I make some reasonably good sales to keep me ticking over. I am also researching a booklet I want to illustrate and publish - hence this brings in zero £'s at the moment, but I am passionate about it and feel it is worth the time and effort.

 

The questions on the form are very probing and the whole procedure is so time consuming, that it is ironic that for the last week I am making no new work, and so no income! Hey Ho!

 

I found CAG today and, although I have managed so far to fill out the form, there are a couple of questions which I feel I don't want to get wrong.

 

The question I am stumbling on now is "How much profit do you expect to make from 6 april 2016 to 5 April 2017?"

My answer will of course be an estimate, but I am scared to under-estimate, but also scared to over-estimate!

 

For the past few years of receiving WTC I have made a loss of a few hundred pounds, but on my last year's accounts, I made a few hundred pounds profit.

 

Any advice gratefully received, Thank you

[smokiejoe]

The rules on self employment changed and TC is checking more people who are self employed to see they meet the criteria. You can get an overview here.

 

How much net profit did you make last year, and how much do you think you'll get this year? It is only an estimate they are looking for, but be aware if you underestimate by a large amount you could have to pay back any overpayment.

 

These forms have gone out to many, not just you.

[Consumer dude]

I would add extra words along the lines of 'I expect to earn X amount however this is an estimate and should not imply confirmation of amounts actually earned at the time', best to cover your back..

[moneytalk]

Many thanks Smokiejoe. Glad to hear I was not the only one to receive this form!

Thank you for your advice. I should aim to be as realistic as possible - and hope that it doesn't look too low, but also be aware for no overpayment penalty!

 

I guess I was asking if anyone knew what figure would sound reasonable and realistic to them. As mentioned i only made a few hundred pounds net profit last year; previously my figures were 'at a loss'.

 

All the best.

[moneytalk]

Many thanks Consumer dude for your helpful advice. I will add those words.

 

This is an excerpt from the link SmokieJoe shared -

 

Policy paper

Revenue and Customs Brief 7 (2015): new rules for the self-employed claiming Working Tax Credit

"Self-employed WTC claimants with earnings below a threshold (this will be based on working hours and the National Minimum Wage) will be asked by HMRC to provide evidence that they are in a regular and organised trade, profession or vocation on a commercial basis and with a view to achieving a profit."

 

I have just calculated 30 hours at £7.20 being the hours WTC recipient are meant to work, and the current Minimum National wage, and that means I should earn £216 per week, which is over £11,000 per year. If I were to state that as my projection, I'm sure that would not look good as this previous year was only a few hundred in profit...would you agree this sounds too much?

 

Cheers

[smokiejoe]

Hi moneytalk,

 

That was an overview for the new rules, but you should read up on the info in the Tax Credit manuals. Start at this link.

 

The other guidance you may want to look at can be found from here. It doesn't automatically mean you have to earn a minimum amount, that's a starting point for anyone looking at your claim. As explained in the guidance, there are other factors to be considered and taken in to account.

 

If you read the info from the above links it should help you understand the process more.

 

Regards,

 

S

[moneytalk]

Many thanks SmokieJoe.

I will read through the manual. It will give me a better understanding of what is being asked for.

Thanks again.