working tax credits changes for self employed from 6th April 2016

[Pixie]

Re: working tax credits changes for self employed from 6th April 2016

Could you move to a smaller house S2M?

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

Thats us out then cos Christmas was a loss and its not much better now , oh well time to put the house up for sale and go live in a tent cos thats all we will be able to afford as we would not be able to afford to stay here .

and no good renting as rents are as expensive as mortgages, and if hubby is forced to close the business its going to cost the government more in benefits , what a nice start to the new year . No wonder i am full of anxiety and panic , my counselor has had to pass me to another colleague as my case is too complex with being ill from aged 5 ,

[swiss90]

Re: working tax credits changes for self employed from 6th April 2016

Hi I spoke to HMRC and what you are saying is incorrect What HMRC are saying is if you are making Min wage they will not contact you. but if you are under the min wage threshold the new department which I run by business consultants if they find that it is not a worth while company and can not or will not bring in min wage in a shot term you could lose your working tax. I only make £200-£300 profit each month and they have said may not be able to claim WT being self employed with the new rules in April

[SXGuy]

Re: working tax credits changes for self employed from 6th April 2016

Hi. Please see my other post which already explains this. That part of the statement refers to people who may be refused job seekers and start up a business in order to claim working tax credits. So long as you can prove you are a real business with a potential to earn a profit it should be fine. It does not mean if you make a loss you won't be entitled.

[swiss90]

Re: working tax credits changes for self employed from 6th April 2016

Hi No the letter says you have to be making a profit or aim to make a profit. if you are below the working tax threshold then they want to see your books bank statements etc to see if it is a business worth keeping. If not you will be refused working Tax

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

I still think you have misunderstood the criteria. But I'm welcome to being convinced otherwise. The way I see it a minimum of earning a minimum wage means you'd be awarded the maximum level of wtc. Then it would go down the more you earn, up to the point you earn to much to claim. So a loss would be the equivalent to earning minimum wage. I.e full award. But as I say. Feel free to show me a counter argument.

I hope so , because Christmas was a loss for us and the rest of the year we just scraped by , I think we will have to wait and see what happens fingers crossed you're right SXGuy

[SXGuy]

Re: working tax credits changes for self employed from 6th April 2016

I still think you have misunderstood the criteria. But I'm welcome to being convinced otherwise. The way I see it a minimum of earning a minimum wage means you'd be awarded the maximum level of wtc. Then it would go down the more you earn, up to the point you earn to much to claim. So a loss would be the equivalent to earning minimum wage. I.e full award. But as I say. Feel free to show me a counter argument.

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

Hi I got the same letter. I am a single dad bringing up a 11 year old on my own. I went self employed 3 years ago but not making the min wage I am in profit each month but only by a few hundred pounds each month. I have not been able to sleep for weeks. I got my letter in between Christmas and New years eve. I had a bad Christmas I can tell you. I don't understand if you try in this country and work you get kicked in the teeth for doing just that. I feel like giving up saying to the government ok you win I will go back on the doll. I would like to know if anybody hears anything.

The letter says you can not get WT if you don't make a profit..... I DO but not much

But then the government says all self employed people must earn a base level of min wage to get working tax........I give up

Yes our Christmas was terrible the business made a loss and we had to open everyday from the 12 th December with extra rent to pay , basically my husband opened up just to stand there to pay rent with no profit , it makes me sick . The thing that makes no sense is that by putting these demands on sole traders will put them on the dole and it will cost the government more in support for mortgage interest dole money as apposed to receiving wtc , yep we're worried too .

[swiss90]

Re: working tax credits changes for self employed from 6th April 2016

Hi I got the same letter. I am a single dad bringing up a 11 year old on my own. I went self employed 3 years ago but not making the min wage I am in profit each month but only by a few hundred pounds each month. I have not been able to sleep for weeks. I got my letter in between Christmas and New years eve. I had a bad Christmas I can tell you. I don't understand if you try in this country and work you get kicked in the teeth for doing just that. I feel like giving up saying to the government ok you win I will go back on the doll. I would like to know if anybody hears anything.

The letter says you can not get WT if you don't make a profit..... I DO but not much

But then the government says all self employed people must earn a base level of min wage to get working tax........I give up

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

I think you addressed wrong person cos I do not have any problems with HMRC
also, I meant equivalent to NMW not that any self-employed must make it and it is roughly £13k p.a. profit from business, anything less and it will still be based on that amount (at least that's how it was portrayed) - that's the general rule

our business doesnt make that no where near, and the rent for our stall has just gone up again and there are 20 empty stalls too , we may have to close the business if we lose the help from working tax credits , and along with that we will most likely lose the house too .

[SXGuy]

Re: working tax credits changes for self employed from 6th April 2016

That would make more sense yes.

[jadex]

Re: working tax credits changes for self employed from 6th April 2016

jadex, i suggest you telephone HMRC to clarify a few things.

Firstly, if you are self employed, you can not possibly calculate your income based on what you earn per hour, minimum wage or not, it simply just doesnt work that way.

And i could be wrong, but i have never, come across a situation where someone whos self employed has been asked to work out their hourly rate. Daily rate, perhaps, but never hourly.

I think you addressed wrong person cos I do not have any problems with HMRC
also, I meant equivalent to NMW not that any self-employed must make it and it is roughly £13k p.a. profit from business, anything less and it will still be based on that amount (at least that's how it was portrayed) - that's the general rule

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

Let me know if you come across any issues such as if they decline the award and the reason for it, and I will try to help you.

Thank you very much we appreciate that

[SXGuy]

Re: working tax credits changes for self employed from 6th April 2016

Let me know if you come across any issues such as if they decline the award and the reason for it, and I will try to help you.

[Spent2much]

Re: working tax credits changes for self employed from 6th April 2016

These are the key parts, they are vital to you being accepted for WTC. Forget about the minimum wage criteria for now, that's for HMRC to assess once they are all the relevant information. This isn't for you to worry about, and in my opinion is NOT a key factor on whether you would be granted WTC or not.

What HMRC firstly will want to establish, is that you have a business, which "seeks" to make a profit. By this, they mean, that you are not simply just someone who has avoided claiming Job Seekers, by starting up an ebay shop, and selling your 2nd hand clothes. We have to remember, there is two different types of benefits, Job Seekers for those who are out of work, and WTC for those in work. Someone could in theory be refused Job Seekers, and apply for WTC instead, this legislation, trys to stop it from happening.

So, regardless of whether your business runs at a profit, or at a loss, WTC would be awarded based on other criteria.

Firstly, they will want to establish, you have a commercial business like I say, 2ndly, proof of this, by way of showing an income and showing expenses.

My Guess is, if you are a registered Self Employed person who submits a Tax Return each year, this will be all they need to establish whether you meet the criteria for WTC.

Other than that, a simple bank statement showing earnings in and expenses out will be ok.

Once you have proved to HMRC you are a proper business, they will use the Net profit to establish what you should be awarded.

Thank you so much for explaining that, yes we are proper business with a business on a market where we pay weekly rent and electric and at the moment we also don't have to pay business rates as the stall is only small . But we put our tax returns in each year and have been trading since September 2005 , for a few years we were doing very well but then the recession hit hard and it has been a slow climb again , but we want it to succeed again and are looking into different things to improve sales . My husband hasn't been unemployed in 23 years so isn't avoiding signing on , Thanks again this has helped a lot .