BTLs and being 'employed' to be eligible for 30 hours childcare

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    BTLs and being 'employed' to be eligible for 30 hours childcare

    Slightly random question, but thought people on here might know (it could be tax related!)

    My partner and I currently get 15 free hours childcare (not the 30 hours as she doesn't work)

    To get 30 hours she's need to be working, and earning more than £120 a week.

    This year she is now earning from property income, as we jointly own a couple of BTLs, but that alone doesn't necessarily count as being 'employed' don't believe.

    As I understand it, she would need to register as being self employed, give her landlord business a name and then show she's doing enough landlord 'stuff' to qualify as being in employment?

    The examples given on the gov website are slightly vague as to whether she can count as being 'employed'

    So as she sorts out Tenancy agreements, meets tenants and does all management company duties, any DIY, does the tax returns etc, for a couple of places she co-owns as well as doing the same for the two other places solely in my name, does that count 'enough' as being self employed?

    im just trying to see if we can benefit from the 30 free hours like most other people can if we go about our BTLs the right way

    many thanks

    #2
    This is indeed a conundrum.

    Technically she is already enjoying an income from her share of the rental income less any allowable expenses and indeed I am assuming that all is declared on her Self Assessment and having the tax computations and tax calculations to support this. For your wife to become self employed the real question is will the "management fees" be of a size which will enable her to have an income to reach the threshold having paid her Self Employed national insurance contributions etc. You are seeking to present a case which would entitle your partner to receive the 30 hours child care. In making such a claim the authorities might regard what you are proposing as a start up and be reluctant to consider her new status until at least one years accounts are in place.

    I really believe that you need to have your partner to have a general discussion perhaps with the CAB or similar qualified person and determine how the situation both current and proposed might assist or handicap in making the application for extended childcare.

    Comment


      #3
      I'm self-employed because it keeps my state pension contributions up to date.

      If you're self employed enough to pay national insurance, I'd say it would be difficult for anyone to argue you wouldn't be working.
      But property investment is a funny beast - as far as the government is concerned, it's "passive" when it suits and "work" when it suits.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

      Comment


        #4
        Many thanks!
        2017-18 is the first year she's been earning from property income, but yes she'll be doing her tax return soon to reflect this
        So would her property income not count as earnings (to satisfy the £120 a week if she can justify that she is self employed), or does it have to be additional earnings in addition to this ( from management company duties etc?) She wouldn't earn enough on top of property income,

        It does say on the Gov website that in setting up your own business, you wouldn't be expected to meet the £120 a week earnings criteria in the first year, which to me means they'd not bother looking at that until year 2. So yes I can imagine it'd be viewed as a startup/new business, but I believe this is ok ref the 30 hours childcare.

        Comment


          #5
          Property income is unusual - you can have property income without being self employed, and the National Insurance is optional (both of which are a bit weird).

          I think your partner could register as self employed, start paying the NI and then ask for the additional child care hours.
          When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
          Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

          Comment


            #6
            Many thanks

            Comment


              #7
              At risk of sounding like an out of touch idiot, I have to ask why you need free childcare if your partner doesn't work?

              Comment


                #8
                Originally posted by Kape65 View Post
                At risk of sounding like an out of touch idiot, I have to ask why you need free childcare if your partner doesn't work?
                How about the wife needing a break and the child needing to socialise?

                Its my understanding the 15 hours the government pay for is at a set rate of pay. This rate, may not actually buy 15 hours, but if you are entitled to the full 30 hours, you maybe lucky to actually get 20 hours a week fully paid for.

                Many years ago (about 16!) I was paying out over £700 a month in nursery fees - this was more than my mortgage. I can tell you if I could have my bill reduced by 15 or 30 hours of government payments, I'd certainly be looking into ways of making it work!

                Comment


                  #9
                  Perhaps she starts recording her work hours - in much the same way a lawyer starts the clock ticking on every call or email? It would be very useful exercise to ascertain how many hours she spends on x and y jobs anyway. And could be used to prove the 30h element for work and child tax credits...

                  Comment


                    #10
                    I would get her to register as self-employed and a small earner like doing Avon , selling Avon or something and therefore say she does so many hours self-employed doing that - keep all the paperwork for it and fill in tax return
                    Setting up your own business as property can be more costly to register

                    Comment

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