Tax Credits and self employed Question?

Question

Can anyone tell me (UK Only)

My son wants to quit his job and go self employed....How does

he cope with Tax credits payments. He would be working about 24hrs a week. Although he is only 20 he is entitled to claim Tax Credits because he has a partner and new born baby...

Anyone else out there doing this and can offer advice? on being self employed and claiming Tax Credits.?

Answer 1

Your son can estimate his income.  He can tell the tax credits what he thinks he will earn over the next twelve months  (or up until april 09 tax yr).

The tax credits will award him based on the estimate.  Tell him to be very careful though, if his income changes or is different to his estimate he must tell them straight away over the phone.

If he doesnt, they will make him pay it all back.

Answer 2

yea, your son should give an estimate of self-employed net-profits for the current year.

if in doubt, over-estimate and reduce the chance of an overpayment situation.