£2bn to be claimed
More than a million
working people without children are losing on average £1600 a year each because
they do not claim the tax credits they are entitled to. These are generally
people under pension age – indeed some of them are very young – but a lot of
them are in their fifties and it is this group that the Revenue is targeting to
get them to claim their entitlements. There is £2 billion waiting to be reunited
with its rightful owner. Could it be you?
Working Tax Credit is given to people who work at least 30 hours a week and have an income up to £13,194 a year (£253 a week) – or £17,967 a year (£345 a week) if you are married or in a civil partnership or live with someone as if you were. And if you are aged 50 or more and returning to work after at least six months on the dole you could get help on higher incomes or with shorter hours. Similarly if you are disabled. Income, of course, includes your pension if you get one, some state benefits, and interest earned by savings. But the capital value of your savings is ignored.
The arithmetic is complex but here are a couple of examples Bill, 53, lives with Kathy who is 51. He lost his job in autumn 2008 and spent six months on the dole. Kathy carried on working but only 10 hours a week for which she gets around £4,000 a year. In April this year Bill got another job but it is only 30 hours a week and he earns £13,000 a year. In the first year tax credits would boost Bill’s income by £2,340. In subsequent years it would be less, but still more than £400 annually.
Annie is 57 and lives in her own flat. She has never been out of work but finds it a struggle to survive on her job working 35 hours a week on the minimum wage of £5.80 an hour. That comes to £10,556 in the year before tax and national insurance. She gets all her council tax paid. But did not realise she could also claim working tax credit which boosts her wages by more than £20 a week.
Find out if you can get working tax credit and all other means-tested benefits by checking at entitledto.com or hmrc.gov.uk/taxcredits Alternatively call HMRC on 0845 302 1415. They cannot help with money off your council tax or rent. Contact your local council about that.
Cashing in gold
With gold at record prices – well above $1000 an ounce in October – and many
people feeling the pinch of the recession it is no surprise that dozens of
companies are springing up to encourage us to turn our precious metals into
spendable cash. They advertise widely on television and in newspapers and ask us
to send them our gold for the ‘best’ offer. But the offers they make may be very
disappointing for several reasons.
First, jewellery is not pure gold, called ‘24 carat’. But most jewellery is 9 carat gold which is 9/24ths or 37.5% gold. The rest is mainly copper. Even 18 carat gold is only three quarters gold and a sovereign – on a ring for example – is 22 carat or about 92% gold. Second, clasps, chains, even some links in a ‘gold’ necklace may be in other metals – only the gold will be worth anything. And third, when it comes to gold an ounce is not an ounce. Vegetables – and humans – are weighed in avoirdupois ounces of 28.35g each. But precious metals are measured in Troy ounces (from the French town of Troyes) which weigh 31.1g. So there is about 10% more in the ‘ounce’ used to quote the price of gold.
The result is that a necklace and locket of 9 carat gold with a safety chain and clasp in steel which weighs half an ounce on a kitchen scale may contain less than 5g of pure gold or barely one sixth of a Troy ounce. Even at $1000 an ounce that would be worth about $150 or £95. You would be lucky to get half that from even a reputable dealer as everyone has to take their cut when it is melted down and resold.
The other big problem with cashing in your gold is the companies you send it to may not even tell you what it is worth – the first you know will be a cheque in the post or a credit to your bank account. By the time you have queried the amount, your necklace will probably have been melted down. Even if you do get the chance to query the value you may find you have to pay for postage and insurance for the gold to be sent back to you.
Lumps of pure gold are worth a lot of money. A one kilogram bar of what is called ‘four nines’ or 99.99% gold is about as big as a small mobile phone and worth £20,000. But you may well be disappointed when you try to turn your gold jewellery into cash.
Live longer, work
longer
The Conservative party will raise the state pension age from 65 to
66 if it wins the next election. The exact details of the plans are not clear
but the process will be decided following a review of pension age to be set up
if it forms the next government.
Shadow Chancellor George Osborne announced that men will see a one year rise in their pension age from 2016. But whether that will the start of the process or the end is not clear. It could mean that any man who reaches 65 in April 2016 or later will have to wait an extra year for his pension. Pension age for women is already rising – it will reach 65 by April 2020. And it seems likely that the latest plans will add on an extra year once that process is complete. Again, how it will be phased in is not clear. However, it is possible that European law will prohibit raising the age to 66 at different times for men and women. All these issues will have to be settled by the review.
Make hay while the
euro shines
British pensioners living in Europe and holidaymakers are all
suffering this from the falling value of Sterling against the euro. But in the
UK many farmers are rubbing their hands because their subsidies – which totalled
around £2.5 billion in 2008 – are calculated and paid in euros. And the falling
exchange rate means they have grown by 15% over last year.
The conversion rate of euros to pounds is fixed on 30 September each year. In 2009 the rate was set at 90.93p to each euro which is nearly 12p a euro more than the rate of 79.03p fixed in 2008. A farmer who got a subsidy worth £10,000 in 2008 will get one worth £11,500 this year. Altogether farmers will harvest a windfall estimated by the National Union of Farmers at £380 million.
This is the third year running that the exchange rate has worked in farmers’ favour. Since 2006 it has boosted payments made in euros by more than a third. A payment worth £10,000 in 2006/07 has grown to £13,417 in 2009/10.
However, farmers are concerned that the supermarkets will reap much of the crop by factoring in the higher subsidies when the try to squeeze down the prices they pay suppliers. And they point out that prices of cereal and dairy products have declined globally by more than the rise they can expect due to the exchange rate.
£60 million refund
The insurance industry has agreed to repay £60 million in increased premiums
to about one million people who had taken out policies to protect their mortgage
payments if they fell ill or lost their job. It has also agreed to restore the
original terms on which the policies pay out if those had been reduced in 2009.
The industry was forced into the deal by the Financial Services Authority which
was concerned that the clauses in policies which said the firms could raise
premiums or reduce the terms for any reason were unfair and unclear. The refunds
would be made by June 2010. Not all policies are included in the deal. So it may
be worth putting in a complaint if your premiums have gone up or the terms of
your policy have been changed.
December 2009