Am I really better off Working?

About a month ago, I started working. I am a contractor doing IT support for a Charity in Central London. This means I have had to give up claiming Employment & Support Allowance and (temporarily) Housing Benefit. I was paid on Thursday, after tax, NI and the cut the umbrella company takes out for providing their services, I am left with £1,196.58.

The day I started working I claimed Tax Credits, only they have decided I am in some way dishonest, so their compliance department have asked me for bills, bank statements, tenancy agreements, etc. I don’t know what the hope to find, its not like I have a few million stashed away *cough*…

This is a breakdown of what I was getting when I was claiming benefits and what I am getting now. Note that bills does not include Electricity (which I pay for on a key meter), Food or Travel.

Income from benefits:

Housing Benefit  £     960.00
ESA  £     516.80
DLA  £     289.60
Total  £  1,766.40
Minus Rent  £     741.40
Minus Bills  £     500.11

Income whilst working (without Tax Credits or Housing Benefit)

Wages after tax  £  1,196.58
DLA  £     289.60
Total  £  1,486.18
Minus Rent  £     451.18
Minus Bills  £     209.89

I don’t blame my local council for waiting until they have the evidence they require (2 months of payslips) before they will pay the housing benefit I am entitled to, after all they are just following the rules that the government set down. However, tax credits are a benefit specifically to help people get back into work, and here I am a month into my job and I have no money because they are wasting time and money investigating me when I have done nothing wrong.

Fortunately I am fairly happy at the moment and I have supportive family and freinds, so I will probably make ends meet, just. This will mean cheap shopping trips, sandwiches every day and no Starbucks…

One thought on “Am I really better off Working?”

  1. Wow. Tax Credits sure have changed since I applied for them. The money started landing in my account straight away; several weeks before I even got a letter telling me I was eligible and what I’d be getting!

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