Can an NRP receive tax credits?

LovesDennys

This looks like another line of enquiry, but I think NACSA is a self-help and advisory service. We are going to need advocacy, we'll be leaving for Australia at the end of the summer and I dont think these issues will be resolved by then. Another forums says SL has a good success rate for reaching an agreement with the CSA regarding his fee, and in any event we could offer a bounty which is linked to the amount recovered.

You have used several CSA technical words in your advice which I dont understand.

What is Protected Income?

What is Personal Allowance?

and if you know, how are these calculated?

kelloggs36

the personal allowance is the same rate as JSA for a single person at the time it was calculated - currently it is £64.45 (or may be 75p, I'm not 100% sure). Exempt income is calculated by taking net income, and deducting:

Personal allowance for single person, any child allowance applicable, family premium if applicable, housing costs (full rent, some service charges) but this is capped at 50% of of an NRP net income if there are no children in the household - this is why you should have been given housing costs, as if they were excessive, they would have been capped - if mortgage, both capital and interest payments, travel to work costs over and above 150 miles per week at 10p per mile as the crow flies (not many people get this), any disability premiums as applicable.

What is left is halved and this is compared to the Maintenance Requirement. If it is more than the maintenance requirement then there is an additional calculation, if the amount is equal to or less than the maintenance requirement, then this is the Notional Assessment.

Protected income is calculated as follows:

Total household income (including partner income, child benefit) less the following:
If single, the JSA amount again, if a couple, then the couple rate.
Child allowances again as applicable (if step children, here is where they get allowance as they don't get it in the exempt income)
Family premium if children in household
Housing costs (if mortgage it will only be the interest payments, not capital), but if rent, usually whole of it, but only up to 50% of the NRP net income if there are no children in the household.
Council Tax
Any disability premiums as applicable and travel to work costs as previously calculated
£30 standard margin

They add all of this up, deduct it from the total household income and then calculate 15% of what is left and add that on to the total. That is your protected income.

They then deduct the protected income from the total household income and if the amount left is equal to or more than the Notional Assessment, then you pay the full notional assessment figure. If it is less, then you pay the reduced figure. The max is 30% of your net income either way.

This is based on a PWC not having any assessable income - as it is slightly more complicated when they do, but it doesn't change the basic calculations, only they add up their assessable too, then halve it.

LovesDennys

Thank you so much for your help.

For all these years I trusted the CSA advice that liability is 30% (actually 40%) of net income. My rent is not quite 50% is net income so it should have been allowed, but much of the rest I dont think applies to me.

I think the way forward is write a simple letter to the CSA pointing out their mistake and give them a chance to put it right. If the CSA does not cooperate I think we have another opportunity to ask the Parliamentary Ombudsman to intervene again. We now know we are dealing with a clerical error and not appealing against a decision.

Given the thresholds you have quoted, it explains why NRPs tend to resign to signing on when they cant afford their rents and tax liabilities. It offers no incentive for an NRP to go out to work when they dont receive any income greater than the JSA allowance. They otherwise receive 100% rent (but not all service charges) paid on the social, plus they attract national Insurance credits, prescriptions, JSA and other passport benefits, plus it removes the need to find the money to get to work. I think the more NRP-friendly CS2 rules was an effort to keep NRPs away from the dole office.