Housing benefit poser

maxmycardagain

For someone self-employed HB is calculated on annual accounts, if someones income improves after use of 1 years figures they can be saddled with an "overpayment", but if the new figure is LESS what happens? firstly id assume the HB will rise but if the old figure was based on a lower figure for 12 or 6 months the claimant has lost out (and possibly by a considerable sum).

HB wont use figures for less than 6 months either, meaning any loss of benefit would have been for a 26 week period, if not 52



(would prefer constructive comments not sniping, witch-hunting or back stabbing please)

thanks in advance

HappyMJ

Hahaha...I've got the same problem just started self-employment. Zero accounts. Council said I have to advise them of any change within X days. Well my income changes every day. Some days I earn £100, most days I earn £50 and some days I earn nothing. If I were to follow the rules I'd be there every day advising change of circumstances. They said provide invoices, receipts and day books. They never said how often and they prove nothing except that I'm making a loss. So they said provide a forecast but if I provide them with the same forecast that I've provided the bank and to Business Link then I'd get nothing as that shows I make a healthy profit sufficient to live off without benefits (£275 per week profit assuming £500 per week income). If I really did earn what I demonstrated to the bank I wouldn't even need an overdraft. So I've made another forecast for council for worst case scenario which shows that I earn a profit equal to about £75 per week from £250 per week income (which in reality has been an weekly loss but has been covered by the Jobcentre) and then I'm entitled to full HB but then I need to save 65% of any excess income over the £75 as they will want it back as I'm right on the edge.

I hope council understands that anyway.....My figures are not looking good.

maxmycardagain

The person concerned put figures in resulting a figure of £110/wk which was applied from april till current date, thier figures from april till now show £90/wk, £20 less (or £14 HB more) whilst having also paid off £300 "overpayment" for the period nov 09-apr 10

i think they may as well jack in as its hardly worth the bother and stress

HappyMJ

maxmycardagain wrote: »

The person concerned put figures in resulting a figure of £110/wk which was applied from april till current date, thier figures from april till now show £90/wk, £20 less (or £14 HB more) whilst having also paid off £300 "overpayment" for the period nov 09-apr 10

i think they may as well jack in as its hardly worth the bother and stress

At least they are doing something and making a small profit. Business is slow at the moment I'm sure it will pick up soon enough. It may only be about £3 per hour profit assuming 30 hours per week but the expenses might cover the full cost of running the car for instance and in my case I got a new computer out of it which I can use for personal use but loads of business stuff really. I also own another laptop for personal use but it is a bit slow...

fluffymovie

We dont use self employed earnings for a period in the past only going forward

To give an example, x starts self employment and states they estimate 100 per week, we use that estimate for first 13 weeks.
We then ask for income and expenditure fir the first 13 weeks and use that for next 13 weeks of claim.
At 26 weeks, we ask for last 26 weeks income and use that for next 26 weeks.
After that 26 weeks, customer will have annual accounts and we use that for the next year etc

If the company stops earning money for some reason such as illness, we can also choose to use a reduced or nil income for that period

I've worked in hb for 10 years and for 5 different councils and we've never gone back unless we believed the estimate was given on false info

maxmycardagain

We dont use self employed earnings for a period in the past only going forward

Quite true, but you would calculate an overpayment on new (higher figures) and implement a lower HB figure for 6 months, which would then be a burden if the actual results were lower than those used, doubly so when the overpayment also then has to be paid, this is what has actually happened.

Or are you saying that newer higher results should NOT throw up an overpayment?

fluffymovie

We would calculate the earnings and use going forward so hb would be lower going forward.

Depending on date they use the earnings from, there may be an overpayment but they shouldn't revise the earnings that had been used previously unless there is a good reason. An example might be a claimant says they work 10 hrs per week but upon review, declare they have done 40 hrs a week. We might say that they would have known earnings would be a lot higher than we were using and so decide to create an overpayment going back.

Hope this makes sense, nightmare typing in my iPhone so apologies for any spelling errors!

maxmycardagain

There are several interesting points ive been made aware of in the case.

The claimant uses a vehicle for the business, HB queried the breakdown insurance because it was paid in 1 lump sum, they wanted to know how much was applicable to the 6 months account period under review, which was ludicrous as it was an annual premium and there would be no payment in the subsequent half-year, they also asked how much personal useage was included in the mobile phone bill, which was.............................. £12 PCM.....

The claimant doesnt claim any amounts for use of thier landline or home which they could, they also said thier WFTC rose £7 a week and HB deducted almost that from thier HB so they wont bother notifying HMRC of any future (small) increases as its pointless

I do think part-time work can prove detrimental to the point of pointlessness

fluffymovie

The issue is that we have to ascertain a relevant assessment period and so even if a bill is only £12pcm this would affect HB payable.

As regards an increase in tax credits, HB is a means tested benefit and all income is taken into account. There would be little point in the existence of Tax Credits if all other benefits were then paid at the same rate. The point of TC is to increase income and as HB is a means tested benefit, you would expect HB to take this into account.

HB takes 65% of any excess income and this has to be paid towards the rent. As a result, for every £1 over the applicable amount, a claimant would keep 35p so it is not a pound for pound thing. Ctax benefit is 20% so if someone is liable for both, they would keep 15p in the pound.

I accept that working is not always the best option and the welfare state should take charge of this but working is more than money received. It assists with self esteem, social life and feelings of self worth so not always a money issue.

maxmycardagain

but working is more than money received. It assists with self esteem, social life and feelings of self worth so not always a money issue.

Noble principle, fine unless it IS the money thats important, and seeing 65% of a part time wage swallowed by a reduction in HB is harsh reward, worse still if the wage is PAYE (not S/employed) and travelling costs/workwear costs cannot be claimed for, when the 35% which isnt deducted from HB is eroded further

fluffymovie

Expenses which are incurred as a result of the job can be allowed for but tbh, I work full time, pay my bills and work 20 miles away from work. That's just the way it is but I have to meet these costs myself. However at no point have I considered not working as I wasn't brought up that way.

However I feel your query has been answered now so will leave you to it! Good luck