Working Tax Credits - Working Hours

[SingleAndHappy]

A friend of mine is starting a new part time job (that fits in with looking after her kids) and she's just received the contract and for some reason it states her working hours as a total for the whole year...it states that she will be required to work 820 hours per year. She's asked the employer why and theyve told her thats how all their contracts are written.

What she's worried about is her working tax credits...she thinks she needs to be working a minimum number of hours each week...is it 16 hours? Is the wording of the contract ok if she needs to show tax credits that she's working the right hours? How do they work out whether she's eligible for working tax credit? Should she go back and ask her manager to change the contract? She's already kind of asked them and they werent too helpful.

Anyone?

[MissFM]

Re: Working Tax Credits - Working Hours

Hi Singleandhappy and welcome to LB:angel2:!

It's worth contacting the DWP/HMRC and asking them exactly what paperwork/proof they need as a first step.

More knowledgeable Beagles will be along!

[teaboy2]

Re: Working Tax Credits - Working Hours

Well 820 hours divided by 52 weeks equals 15.8 hours per week. So its not even 16 hours a week, first i would ask the employer why it works out at 15.8 hours and not 16 hours per week by asking them for details as to how they calculate the hours per year, as their formula for working out her hours may well result in her weekly hours being 16 hours.

I believe HMRC work out your tax credit based on annual income and hours. Though it is strange for an employer to put annual hours in a contract and not weekly hours and looking at the eligibility requirements she would need to be working a minimum of 16 hours per week when she has 1 child or more and is single (for a couple with 1 child she would need to work 24hrs or more a week) - So at 15.8hrs she would not meet the eligibility requirement for a single parent.

Eligibility is found here - https://www.gov.uk/working-tax-credit/eligibility

[strong123]

Re: Working Tax Credits - Working Hours

A friend of mine is starting a new part time job (that fits in with looking after her kids) and she's just received the contract and for some reason it states her working hours as a total for the whole year...it states that she will be required to work 820 hours per year. She's asked the employer why and theyve told her thats how all their contracts are written.

What she's worried about is her working tax credits...she thinks she needs to be working a minimum number of hours each week...is it 16 hours? Is the wording of the contract ok if she needs to show tax credits that she's working the right hours? How do they work out whether she's eligible for working tax credit? Should she go back and ask her manager to change the contract? She's already kind of asked them and they werent too helpful.

Anyone?

Hi and welcome,

Your friend is right, the minimum number of hours she will have to work is 16.

With regard to the contract, as long as her hours work out a minimum of 16 than it is of no relevance how it's written.

The tax credits compliance team will ask for further information should they need it. When I was claiming tax credits, because my company contract states that they do not have to offer me a certain amount of, they contact my company to confirm I was actually working enough hours. I also had to supply wage slips.

Tell your friend not to worry and if need be, contact ct helpline.

[strong123]

Re: Working Tax Credits - Working Hours

Well 820 hours divided by 52 weeks equals 15.8 hours per week. So its not even 16 hours a week, first i would ask the employer why it works out at 15.8 hours and not 16 hours per week by asking them for details as to how they calculate the hours per year, as their formula for working out her hours may well result in her weekly hours being 16 hours.

I believe HMRC work out your tax credit based on annual income and hours. Though it is strange for an employer to put annual hours in a contract and not weekly hours and looking at the eligibility requirements she would need to be working a minimum of 16 hours per week when she has 1 child or more and is single (for a couple with 1 child she would need to work 24hrs or more a week) - So at 15.8hrs she would not meet the eligibility requirement for a single parent.

Eligibility is found here - https://www.gov.uk/working-tax-credit/eligibility

So glad your good at maths - I couldnt work that out...would it be lunch breaks they've accounted for?

Just with regard to tax credits for couple, only one of them has to work a minimum of 26 hours so if her partner is working that or more it doesn't matter what she works they would still be entitled...unless it's changed in the last year, if so I stand corrected.

[teaboy2]

Re: Working Tax Credits - Working Hours

So glad your good at maths - I couldnt work that out...would it be lunch breaks they've accounted for?

Just with regard to tax credits for couple, only one of them has to work a minimum of 26 hours so if her partner is working that or more it doesn't matter what she works they would still be entitled...unless it's changed in the last year, if so I stand corrected.

I highly doubt they have accounted for lunch breaks, as the 820 hours is paid hours, lunch breaks are either paid or unpaid and if unpaid then wouldn't count towards your working hours. Plus the deduction of lunch breaks are 20-30mins usually per day, so it wouldn't add up as the 0.2 hours less of the 16 hour mark amounts to about 10 minutes per week.

Regarding your other question, where its a couple with one child, the couple would have to work at least 24hrs between them with 1 of them working a minimum of 16hrs per week. So if the total hours both parents work is more than 24 hours and 1 parent is working more than 16hrs (or both are) then yes she would be eligible. If however the couple were working 24 hours and bother worked only 12 hours per week, then she would not be eligible as the couple would not meet the requirement of working 24hrs with on couple working a minimum of 16hrs.

[strong123]

Re: Working Tax Credits - Working Hours

I highly doubt they have accounted for lunch breaks, as the 820 hours is paid hours, lunch breaks are either paid or unpaid and if unpaid then wouldn't count towards your working hours. Plus the deduction of lunch breaks are 20-30mins usually per day, so it wouldn't add up as the 0.2 hours less of the 16 hour mark amounts to about 10 minutes per week.

Regarding your other question, where its a couple with one child, the couple would have to work at least 24hrs between them with 1 of them working a minimum of 16hrs per week. So if the total hours both parents work is more than 24 hours and 1 parent is working more than 16hrs (or both are) then yes she would be eligible. If however the couple were working 24 hours and bother worked only 12 hours per week, then she would not be eligible as the couple would not meet the requirement of working 24hrs with on couple working a minimum of 16hrs.

Yes of course, my apologies.

Thank you.

[ostell]

Re: Working Tax Credits - Working Hours

But she would also be entitled to 4 weeks holiday per year so the 820 hours divided by 48 working weeks is 17 hours per week. Or is that too simplistic?

[SingleAndHappy]

Re: Working Tax Credits - Working Hours

Well 820 hours divided by 52 weeks equals 15.8 hours per week. So its not even 16 hours a week, first i would ask the employer why it works out at 15.8 hours and not 16 hours per week by asking them for details as to how they calculate the hours per year, as their formula for working out her hours may well result in her weekly hours being 16 hours.

I believe HMRC work out your tax credit based on annual income and hours. Though it is strange for an employer to put annual hours in a contract and not weekly hours and looking at the eligibility requirements she would need to be working a minimum of 16 hours per week when she has 1 child or more and is single (for a couple with 1 child she would need to work 24hrs or more a week) - So at 15.8hrs she would not meet the eligibility requirement for a single parent.

Eligibility is found here - https://www.gov.uk/working-tax-credit/eligibility

Thank you for all your help and I will pass this advice on to her.

Have I understood this correctly though? If her contract stated that she worked 832 hours a year (ie 52 weeks x 16 hours per week) then she would be entitled to working tax credit?...she is single and has one child, a toddler.

If this is the case I will tell her to go back to her employer and see if they can change this to 832 hours a year.

[teaboy2]

Re: Working Tax Credits - Working Hours

But she would also be entitled to 4 weeks holiday per year so the 820 hours divided by 48 working weeks is 17 hours per week. Or is that too simplistic?

Yes paid holidays, plus it wouldn't be 4 weeks its 5.6 weeks. So her 820 hours are likely inclusive of holidays, but then they may not be, hence why we need to ask the employer what the formula was for working out how many hours she is contracted to work per year.