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Working tax credits effectively abolished completely?

Posted: 20 Jul 2015, 10:09
by Little John
I just found this on my travels.

Is this right?
From April 2016 the income threshold to claim Working Tax Credit will go down from £6,420 to £3,850 at the same time as the minimum wage rises to £7.20.

To claim, you must work at least 16 hours per week.

16 hours at £7.20 pays £5,990.40 per year.

That's £2,140 over the threshold to qualify for tax credits at all.

No one will ever qualify for this benefit after April 2016!

Osborne has totally abolished Working Tax Credits and no one has even noticed....is that what Duncan Smith was cheering in the budget?

Posted: 20 Jul 2015, 23:44
by cubes
It's not quite as bad as you make out (although still bad obviously).

The withdrawal rate isn't 1 for 1, it's 41% so for every £1 over the threshold 41p is removed. Cba to work out the figures as it's late but I got the info from https://www.gov.uk/government/publicati ... or-2014-15