Tax Credits. Do I understand this correctly?

Marcel

Marcel

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Marcel
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If I'm correct, and I think I am. The tax credit system was introduced as a replacement for the old tax code / allowance system.
So 15+ yrs ago, your untaxed income allowance was bumped up via your tax code if you had children.

The tax credit system was a replacement to this, meaning that instead of giving you the 'allowance' through the tax code, parent and non-parents have the same tax code, and they pay back to the parents via the tax credits.
 
I understand that tax credits top up your earnings. This can apply to a self employed person whose profit falls below a certain level of income. despite working a certain number of hours
 
Not sure really I thought child allowance was for children and tax credits if your income was below a certain level

One was working tax credit if employer paid insufficient for living then tax credits for unemployed regardless of children or not so single person returning into low paid work got a tax credit
 
working tax credits
child tax credits

when i started self employed photogrpaher I got these to top up my income before being able to cut the strings...... 7 yrs later am bordering on going back to tax credits haha.. it actually takes the worry out of not being able to earn enough... But if your making so little and needing it then things arnt going well :( But was a nice crutch when i forst started
 
The child allowance / child benefit is not what Im talking about. That's different. That's non-means tested for anyone who has a child. (Well, I think it's now capped at 50k earners isn't it? Something like that).

No, the actual Child Tax Credit Im sure replaces the old method of giving allowances for those with kids via the tax code.
 
Marcel said:
The child allowance / child benefit is not what Im talking about. That's different. That's non-means tested for anyone who has a child. (Well, I think it's now capped at 50k earners isn't it? Something like that).

No, the actual Child Tax Credit Im sure replaces the old method of giving allowances for those with kids via the tax code.
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It does and is some very serious money as well.

I am no fan of it at all. However I don't think it is fair to just take it away. I would just let it run out, stop it for new parents say 12 months from now. That way the expectations just won't be there. Then in 17 years it's phased out.
 
Going back a fair few years a married heterosexual couple would get a married tax allowance, I am unsure but when you got same sex couples or so many single parents I think that's when the allowance ended

As far as I recall Gordon Brown brought the credit system available for all to claim but was means tested and took into account dependants
 
I recall that married mans allowance was paid until April 1990 but i don't ever recall a seperate allowance for having kids before the child tax credit arrangement of the labour government in the late 1990's / early 2000's
 
If we try and look and the whole problem of benefits, tax credits, et al, in a balanced and hopefully un-biased way, ignoring any political leanings I obviously have, I see a number of issues…

It is right and proper that the government want to reduce any benefits paid out wherever it can justifiably do so. After all anyone who is working and paying tax and national insurance, businesses who are paying corporation tax, business rates and so on, in fact anyone who is currently paying, or in the case of the retired have paid into the “system” is actually paying for these benefits. I would much rather we would need to pay no benefits at all to anyone. Of course that’s never going to be the case.

The welfare state is there to provide a safety net to those in need, and quite rightly so.
Some people are disabled or ill and just can’t work, maybe this is a permanent condition or hopefully not, some have been made redundant through no fault of their own, and this can happen to anyone. Either way they need financial help for themselves and their children. The financial help doesn’t mean foreign holidays, 60 fags a day and loads of booze but it does mean a reasonable standard of living, a warm and dry home and adequate food. I for one would never countenance people dying on our streets from starvation, or pensioners dying from cold or malnutrition.

I suspect that the “minimum wage”, the “living wage” and now the new “national living wage” have done nothing but subsidise some businesses that aren’t prepared to pay a decent amount of pay to their staff. Profit should not come before people. However, if businesses fail then they fail, that’s what you get with a free market economy. It’s not that I don’t have any sympathy for “one man bands” but life is like that sometimes.
 
Marcel said:
If I'm correct, and I think I am. The tax credit system was introduced as a replacement for the old tax code / allowance system.
So 15+ yrs ago, your untaxed income allowance was bumped up via your tax code if you had children.

The tax credit system was a replacement to this, meaning that instead of giving you the 'allowance' through the tax code, parent and non-parents have the same tax code, and they pay back to the parents via the tax credits.
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No
Tax credits replaced family credit which replaced family income supplement. They're an in-work top up benefit for the low paid.

The Labour government called them tax credits to remove the stigma of them being a 'benefit' to enciurage take up, they also increased them substantially to encourage employment.

IMHO the error was to kick start the low earning sector by giving the money to families, it should have been given to employers. Because that's who is being subsidised. It's created a huge 'welfare bill' and encouraged the stigmatisation of that. In reality tax credits are supporting employers who won't pay a living wage and housing benefit subsidises landlords to help keep a light under house prices. The working poor are just a conduit for that money.
 
Just to add.
Current tax credit customers will eventually be Universal Credit customers as it further rolls out, putting it back firmly in the land of 'benefits' although the title is clearly designed to blur the line.

UC being a flexible benefit that automatically changes to take account of circumstances, to remove the merry go round of JSA, tax credits, ESA etc.
 
dejongj said:
I am no fan of it at all. However I don't think it is fair to just take it away. I would just let it run out, stop it for new parents say 12 months from now. That way the expectations just won't be there. Then in 17 years it's phased out.
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and how do you expect low paid earners/part time workers/single parents to actually live?
 
POAH said:
and how do you expect low paid earners/part time workers/single parents to actually live?
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Don't have children if you can't afford them on your current income. It's a choice.
 
dejongj said:
Don't have children if you can't afford them on your current income. It's a choice.
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some people could afford children and then lost their jobs and couldn't find a similar paid job. what then? what about people that split up or have partners die?
 
bloody woman on the news the other day who owns her own business says she is going to lost nearly £400 a week, [PLEASE DON'T TRY TO BYPASS THE SWEAR FILTER] me big time, that alone is a decent bloody wage
 
POAH said:
some people could afford children and then lost their jobs and couldn't find a similar paid job. what then? what about people that split up or have partners die?
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Perhaps you should try and read what I said ;) your scenario would not make a single bit of difference :thumbs:
 
dejongj said:
Perhaps you should try and read what I said ;) your scenario would not make a single bit of difference (y)
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sorry but it would. there is no difference to a low income family to that of someone that becomes low income. the credit system is there to help low income family's particularly if they have to cut their hours. what kind of sociaty would we be if only the rich had t. maybe we could restrict health care to those that pay tax?
 
Gary Coyle said:
bloody woman on the news the other day who owns her own business says she is going to lost nearly £400 a week, f*** me big time, that alone is a decent bloody wage
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I'm not certain that the reported figures are correct.
 
POAH said:
sorry but it would. there is no difference to a low income family to that of someone that becomes low income. the credit system is there to help low income family's particularly if they have to cut their hours. what kind of sociaty would we be if only the rich had t. maybe we could restrict health care to those that pay tax?
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But that is not what I said at all :confused: and from what I said it would not affect them at all, I really urge you to actually read what I wrote opposed to argueing against it.

For your convenience;

dejongj said:
It does and is some very serious money as well.

I am no fan of it at all. However I don't think it is fair to just take it away. I would just let it run out, stop it for new parents say 12 months from now. That way the expectations just won't be there. Then in 17 years it's phased out.
Click to expand...
 
dejongj said:
But that is not what I said at all :confused: and from what I said it would not affect them at all, I really urge you to actually read what I wrote opposed to argueing against it.

For your convenience;
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you are advocating stopping it which is the point I'm arguing against which you can't seem to get. If you stopped our tax credits we would loose our house
 
POAH said:
you are advocating stopping it which is the point I'm arguing against which you can't seem to get. If you stopped our tax credits we would loose our house
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The current system and i suspect any future system fails in the fact that it cant weed out the genuine from the not genuine claims, i dont know you from Adam and you could be the biggest conman/scrounger and player of the system ever to exist and just taking an easy ride, on the other hand you could be exactly what you claim to be, an unfortunate victim of circumstance who needs a leg up from time to time.

The former can go rot for all i care, the latter deserve a break and some help
 
Phil V said:
No
Tax credits replaced family credit which replaced family income supplement. They're an in-work top up benefit for the low paid.

The Labour government called them tax credits to remove the stigma of them being a 'benefit' to enciurage take up, they also increased them substantially to encourage employment.

IMHO the error was to kick start the low earning sector by giving the money to families, it should have been given to employers. Because that's who is being subsidised. It's created a huge 'welfare bill' and encouraged the stigmatisation of that. In reality tax credits are supporting employers who won't pay a living wage and housing benefit subsidises landlords to help keep a light under house prices. The working poor are just a conduit for that money.
Click to expand...

Sort of. I was actually right in what I meant. Just done some more reading and looking back through my PAYE coding notices.
It was Children's Tax Credit I was referring to (Not the similarly named Child Tax Credit), which was given back to a parent through their tax code. This was then merged with the Family Credit system to create the Working Familes Tax Credits with Child Element.
 
Marcel said:
Sort of. I was actually right in what I meant. Just done some more reading and looking back through my PAYE coding notices.
It was Children's Tax Credit I was referring to (Not the similarly named Child Tax Credit), which was given back to a parent through their tax code. This was then merged with the Family Credit system to create the Working Familes Tax Credits with Child Element.
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I used to get the old stupidly named married mans tax allowance even though ive never been married
 
POAH said:
you are advocating stopping it which is the point I'm arguing against which you can't seem to get. If you stopped our tax credits we would loose our house
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Oh FFS can't you read or something? I am NOT advocating to stop it for those already in receipt, I am advocating to stop it for those who aren't yet in receipt 12 months from now. That provides plenty of time to keep your dick in your pants, and further more the system will then be phased out automatically WITHOUT causing hardship to those currently counting on it.

I think you have some kind of already always listening racquet going on where you make up things that I did not say at all.
 
UC is going to be a wake up call for the self employed. If you aren't earning a decent amount you'll be told to get a job! It also assumes you get NMW for every hour you work in the business so any top up is beyond that even if you don't actually get that. It also explains the sudden desire to wack up NMW as it means there will be a lot less UC being paid out.

https://www.moneyadviceservice.org.uk/en/articles/universal-credit-for-the-self-employed

The whole tax and benefit system is a daft merry go round. Employers need to a pay decent wage so that their workers can live on those wages without the rest of us having to subsidise them. They also need to pay a proper amount of tax and stop avoiding paying their way.
 
POAH said:
some people could afford children and then lost their jobs and couldn't find a similar paid job. what then? what about people that split up or have partners die?
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Well...they could afford it on their then current wage which was what he said?
The people you talk of are the ones genuinely in need rather than those appearing to have children just because they are biologically able.
Hth.
 
Gary Coyle said:
bloody woman on the news the other day who owns her own business says she is going to lost nearly £400 a week, f*** me big time, that alone is a decent bloody wage
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What she is reported to actually have said in the daily mail is "I run a household of five people living on less than £400 a week. My day to day living cost are covered by my tax credits, my child benefit and maintainance." not that she's on £400 benefits per week- it's the daily mail who suggest that she's on £400 of benefits a week. It notes that she worked for 15 years in call centres and had a period on unemployment benefit after splitting with her husband so she's paid into the system and is now in a place where she needs some support.

To get any return on tax credits you actually need to earn enough to pay tax, so there's £10k+ she earns working from home whilst raising 4 kids - say around £200+per week she earns on her own to get her beyond the personal allowance and into tax credit territory, most she'll get from Child allowance will be around £60 per week for 4 kids and there's maintenance payments. I personally don't fancy raising 4 kids on £400 a week and I think her main issue is she voted for a political party who told her they wouldn't take away the tax credits and then having unexpectedly got into power with a majority, start to take away her tax credits. I don't know the woman but with 4 kids any 'proper' job would probably bring child care costs which quickly eat into earnings.
 
The truth compared to what is reported in the Daily Heil seldom match. It went sadly wrong in the '30's when it supported Mosley's blackshirts and Hitler. They haven't really changed much since. Terrible paper.
 
dejongj said:
Oh FFS can't you read or something? I am NOT advocating to stop it for those already in receipt, I am advocating to stop it for those who aren't yet in receipt 12 months from now. That provides plenty of time to keep your dick in your pants, and further more the system will then be phased out automatically WITHOUT causing hardship to those currently counting on it.

I think you have some kind of already always listening racquet going on where you make up things that I did not say at all.
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so you'll have a two tier system with those getting it and those who are not and the only people that can have kids are rich. seems fairly f***ed up. I take it you don't have kids or are pretty well off and have never been poor. Vote conservative did we?
 
Gary Coyle said:
The current system and i suspect any future system fails in the fact that it cant weed out the genuine from the not genuine claims, i dont know you from Adam and you could be the biggest conman/scrounger and player of the system ever to exist and just taking an easy ride, on the other hand you could be exactly what you claim to be, an unfortunate victim of circumstance who needs a leg up from time to time.

The former can go rot for all i care, the latter deserve a break and some help
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well you can't claim unless you send in a birth certificate
 
Jim_Tod said:
What she is reported to actually have said in the daily mail is "I run a household of five people living on less than £400 a week. My day to day living cost are covered by my tax credits, my child benefit and maintainance." not that she's on £400 benefits per week- it's the daily mail who suggest that she's on £400 of benefits a week. It notes that she worked for 15 years in call centres and had a period on unemployment benefit after splitting with her husband so she's paid into the system and is now in a place where she needs some support.

To get any return on tax credits you actually need to earn enough to pay tax, so there's £10k+ she earns working from home whilst raising 4 kids - say around £200+per week she earns on her own to get her beyond the personal allowance and into tax credit territory, most she'll get from Child allowance will be around £60 per week for 4 kids and there's maintenance payments. I personally don't fancy raising 4 kids on £400 a week and I think her main issue is she voted for a political party who told her they wouldn't take away the tax credits and then having unexpectedly got into power with a majority, start to take away her tax credits. I don't know the woman but with 4 kids any 'proper' job would probably bring child care costs which quickly eat into earnings.
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Her tax credits should work out to around £316 a week, that doesn't account for any help with council tax or rent she may get, nor the wages she pays herself or the maintenance she gets on top of that from the kids father. It's now being reported that she is unlikely to be affected by any of the tax credit changes anyway.
 
POAH said:
so you'll have a two tier system with those getting it and those who are not and the only people that can have kids are rich. seems fairly f***ed up. I take it you don't have kids or are pretty well off and have never been poor. Vote conservative did we?
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If you can't afford to have kids, you can't afford to have kids, why should other people have to pick up the tab for those who can't afford it, that is what really seems fairly f****d up. The two tier system would run out in 18yrs anyway then everyone would be on the same tier.
 
POAH said:
so you'll have a two tier system with those getting it and those who are not and the only people that can have kids are rich. seems fairly f***ed up. I take it you don't have kids or are pretty well off and have never been poor. Vote conservative did we?
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We've been having a two tiered system for decades before regarding married couples allowance. Once the last claimants die it will be something of the history books. Did it stop people getting married?

And no it isn't just be people who are rich can have children. I have children but we also make choices like most people I know.
 
POAH said:
so you'll have a two tier system with those getting it and those who are not and the only people that can have kids are rich. seems fairly f***ed up. I take it you don't have kids or are pretty well off and have never been poor. Vote conservative did we?
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Whilst I'm probably as soft a leftie as you're likely to meet...
People on average salaries are making hard choices about having children, from just above the tax credit threshold to 40k a year, we have to budget to have children.

Currently choosing to have children without worrying about money is only an option for the poor and the rich. For most 'normal' people money is a big part of the decision.

It's one thing for the state to catch people when they hit hard times, it's something else entirely for the state to just keep picking up the tab for people who want to breed like rabbits. It's a tough one to break through after all these years, but it has to be done at some point.
 
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