TCTM07APPX1 - Calculation of entitlement: The rates and how to use them
Appendix 1 - The rates and how to use them
Note: At points in the calculation when the legislation does not require the numbers to be rounded the calculations display numbers only to 3 decimal places (dp). This is for presentational ease and does not affect the remainder of the calculation. As a result there may be occasion when your own calculation may vary slightly to the award, however this will be rare and due only to the rounding applied by the computer system. For most cases the 3 figure (dp) number will be used in the rounding but occasionally the last figure displayed will show a zero. E.g. 1.120. An assumption is therefore made that there are further numbers after the 0, (eg.1.1201) which when rounding up will result in 1.13. In these cases only, the rounding is shown as 1.120 = 1.13.
Working Tax Credit
The Working Tax Credits (Entitlement and Maximum Rate) Regulations 2002, Schedule 2
WTC includes two entitlements:
- Work elements
- Child care elements
| WTC Work Elements |
2008/2009 rates | 2009/2010 rates | Calculation TY 2009/2010 |
Maximum daily rate |
|---|---|---|---|---|
| Basic element |
£1,800 |
£1,890 |
£1,890 / 365 = £5.178 rounded up = |
£5.18 |
| Second adult element |
£1,770 |
£1,860 |
£1,860/ 365 = £5.095 rounded up = |
£5.10 |
| Lone parent element |
£1,770 |
£1,860 |
£1,860 / 365 = £5.095 rounded up = |
£5.10 |
| Disability element |
£2,405 |
£2,530 |
£2,530 / 365 = £6.931 rounded up = |
£6.94 |
| Severe disability element |
£1020 |
£1,075 |
£1,075 / 365 = £2.945 rounded up = |
£2.95 |
| 30 hour element |
£735 |
£775 |
£775 / 365 = £2.123 rounded up = |
£2.13 |
| 50 plus element (16-29 hours) |
£1,235 |
£1,300 |
£1,300 / 365 = £3.561 rounded up = |
£3.57 |
| 50 plus (30+ hours) |
£1,840 |
£1,935 |
£1,935 / 365 = £5.301 rounded up = |
£5.31 |
WTC Childcare Element
The Working Tax Credits (Entitlement and Maximum Rate) Regulations 2002, Regs 20(2) and (3)
The WTC childcare element is worth up to 80% of allowable childcare costs (up to a limit). Maximum eligible costs are £175 per week where there is 1 child in relevant childcare and £300 where 2 or more children are in relevant childcare.
| Max childcare costs |
2008/09 rates | 2009/10 rates | Calculation TY 2009/2010 |
Maximum daily rate |
|---|---|---|---|---|
| 1 child |
£175.00 |
£175.00 |
£175.00 / 7 = £25.00 round up = |
£25.00 |
| 2 or more children |
£300.00 |
£300.00 |
£300.00 / 7 = £42.857 round up = |
£42.86 |
Child Tax Credit
CTC includes two entitlements:
- “Individual Elements” and
- “Family Element”
The CTC Individual Elements includes the following elements:
| Elements |
2008/2009 rates | 2009/2010 rates | Calculation TY 2009/2010 |
Daily rate |
|---|---|---|---|---|
| Child Element |
£2,085 |
£2,235 |
£2,235 / 365 = £6.123 rounded up = |
£6.13 |
| Young person element |
£2,085 |
£2,235 |
£2,235 / 365 = £6.123 rounded up = |
£6.13 |
| Disability element (includes child element) |
£4,625 |
£4,905 |
£4,905 / 365 = £13.438 rounded up = |
£13.44 |
| Severe disability element (includes child element) |
£5,645 |
£5,980 |
£5,980 / 365 = £16.383 rounded up = |
£16.39 |
The CTC Family Elements includes the following elements:
| Elements |
2008/2009 rates | 2009/2010 rates | Calculation TY 2009/2010 |
Daily rate |
|---|---|---|---|---|
| Family element |
£545 |
£545 |
£545 / 365 = £1.493 rounded up = |
£1.50 |
| Family & Baby element |
£1,090 |
£1,090 |
Above Family element is added to this Baby element. £545 / 365 = £1.493 rounded up = |
£1.50 |
Income Thresholds TY 2009/2010
| Thresholds |
2008/2009 rates | 2009/2010 rates | Calculation TY 2009/2010 |
|
|---|---|---|---|---|
| WTC threshold |
£6,420 |
£6,420 |
£6,420 / 365 = |
£17.58 |
| WTC withdrawal rate |
39% |
39% |
|
|
| CTC only threshold |
£15,575 |
£16,040 |
£16,040/ 365 = |
£43.94 |
| CTC 2nd threshold |
£50,000 |
£50,000 |
£50,000 / 365 = |
£136.98 |
| CTC family element withdrawal rate |
6.67% |
6.67% |
|
|
| Income increase disregard |
£25,000 |
£25,000 |
|
|
