What are Tax Credits?
Tax Credits are a state benefit which the UK government pays to eligible claimants. If you qualify for tax credits, you must fill out a claim form to apply for them. The Tax Credit Office could fine you up to £3,000 if you provide incorrect information. They will usually backdate tax credits up to 31 days before the start of your claim. You might have to ask them to do this if you are claiming other benefits. The amount of money that you will receive every week or four weeks depends on your circumstances, particularly your income. Working Tax Credit can top up low incomes, and Child Tax Credit can help with childcare costs. You can’t claim tax credits at the same time as Universal Credit because it’s replacing them.
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What is National Insurance?
National Insurance is a form of tax which applies to your earnings for every pay period. This could be weekly or monthly according to your employer’s payment arrangements. It will be deducted from your wages along with Income Tax. If you are self-employed, you have to complete a Self Assessment tax return before paying both Income Tax and National Insurance Contributions. You must pay NIC if you are over 16 years old and in employment earning over £162 a week, or self-employment with a profit above £6,205 a year. You stop paying when you reach the State Pension age. If you don’t pay National Insurance contributions, you will not qualify to receive certain benefits. These include the State Pension, Jobseeker’s Allowance, Employment and Support Allowance, Maternity Allowance, and Bereavement Support. You need an NI number to pay.
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Last week, chancellor Philip Hammond delivered a speech announcing the new Budget from HM Treasury. He also claimed that these financial plans would result in the end of this long and exhausting era of austerity. However, it can be difficult to read through all of the information in the Budget to see if this is really the truth. Despite promises of more savings for many taxpayers, these savings may actually be lower than suggested.
Continue reading Changes to National Insurance Contributions in 2019
September 2018 will see thousands of children across the UK turning 16. These children, born from 1st September 2002, can then manage their own Child Trust Fund. Some parents might have forgotten about this savings account since its introduction in 2005. While the scheme ended on 1st January 2011, any children born between these dates should have some amount of money waiting for them in their own Child Trust Fund.
Continue reading Could Your Kids Have Hundreds of Pounds in a Child Trust Fund?