ESA and Medical Retirement

sunnyone

seven-day-weekend wrote: »

Whetheer you pay tax or not is based on your total income and tax code, with the disregard of certain Benefits (IB claimed before 1992, DLA).

Why do you think you shouldn't pay any tax if your income is above the tax threshold?

its 1995 not 1992, thats when IVB became IB.

seven-day-weekend

sunnyone wrote: »

its 1995 not 1992, thats when IVB became IB.

Thanks for the correction.

Actually, I don't know either what the justification is for reducing a (non-means-tested) Benefit if you have a Pension. It is not reduced if you have income from another source; you could have £1000s coming in in rent, or a partner who is a millionaire, or win the lottery, and still claim.

Does anyone know the justification for this?

healy

jdturk wrote: »

You are getting what you are entitled to in terms of a mean tested benefit. Why should you get the full amount if you have another income?

The point is that contribution based IB/ESA is supposed to be a non-means tested benefit.

50Twuncle

jdturk wrote: »

You are getting what you are entitled to in terms of a mean tested benefit. Why should you get the full amount if you have another income?

Why shouldn't I ?
I have worked hard all of my working life - so why should I be penalised for this ?

zzzLazyDaisy

jdturk wrote: »

You are getting what you are entitled to in terms of a mean tested benefit. Why should you get the full amount if you have another income?

IB is NOT a means tested benefit, it is a contribution based benefit.

However, if the IB claimant has also paid into a pension scheme which allows early retirement on the grounds of ill-health, then IB is reduced if the weekly ill-health retirement payment exceeds £85 a week.

So, if on IB or contribution based ESA, you can have income from investments, savings, renting a house out etc ... and no deduction is made.

But if you have diligently paid into a pension scheme or made provision through your employer for ill-health insurance (PHI) your benefits are reduced.

Personally I don't think that is fair, but that is the law.

zzzLazyDaisy

skcollobcat10 wrote: »

Hello,

Which bit do you not think is fair?

I don't think it is fair to penalise people by reducing a non-means-tested benefit for paying into a pension that pays out in the event of being unable to work in the event of illness or injury.

I also suspect that many MP's do not understand how the system works - I remember listening to a house of commons debate some time ago about the reform of the benefits system and one MP gave an assurance that it was not intended that any reform would result in people such as injured soldiers or firefighters having their disability pensions reduced because they claim IB. He was completely taken aback to be informed that is, in effect, what ALREADY happens.

50Twuncle

Sorry to drag this up again - but the £85 rule - is that gross or net - this could be important !!

from
Pension income rules

If you receive contribution-based Employment and Support Allowance and have a gross pension income of more than £85 a week, the amount of benefit payable will be reduced by half of the excess.

NASA_2

Income Related is net amount and Contributory is Gross.

50Twuncle

I am on Contribution based ESA
So if I bring in say £185 gross in a pension - (around £150 net) - per week - do they base my income as being £185 or £150 for the purposes of removing half of the amount above £85 from benefits ?

ie)
If £185 then this is £50 off my ESA
If £150 - this is £32.50 off my ESA

50Twuncle

healy wrote: »

The point is that contribution based IB/ESA is supposed to be a non-means tested benefit.

I agree with this - why should someone who has worked hard all their life and suddenly becomes unable to carry on - have to forgo what they have contributed to ?