pre-1995 invalidity benefit

sixtyatlast

I get pre-1995 ivb which is a non-taxable benefit.On the direct gov website the pensiom credit estimator says to include all taxable income.I have been advised twice on the pension credit helpline that I should not include my ivb and once that I should.I also had a meeting with a pension credit advisor who said I should include it because the website actually means all income after tax. Can anyone tell me which is right,and if it is NOT included where/what is the relevant regulation ?

If I was a new claimant to sickness benefit I believe the first 28 weeks is non-taxable and not classed as income for pension credit purposes;if this is right would it seem to back up my belief that my non-taxable ivb should not count as income?

MrsManda

Are you just trying to get an estimate
from the Pension Credit calculator or are you actually applying for pension credit?
The guidance notes for the application form say that you don't need to provide information about social security benefits as they already can access that information.

What type of money do I need to tell you about?
Please do not tell us about social security benefits or State Pension paid
by The Pension Service. We already have this information.
Please do tell us about any of the following types of money you or your
partner have coming in.
l Money from someone who rents a room in your home or who lives in
part of your home – for example, a boarder, lodger, tenant or subtenant.
l Working Tax Credit.
l Money from a pension paid to victims of Nazi persecution.
l Royalties or money for a book registered under the Public Lending
Rights Scheme.
l Money from your ex-partner to pay for day-to-day living costs.
l Social security benefits from abroad.
l Money from a war disablement pension or war widow’s or widower’s
pension from abroad.
l Sick pay.
l Regular payments from a trust.
l Money from an equity release scheme.
l Money from the Armed Forces Compensation Scheme.

http://www.direct.gov.uk/en/Pensionsandretirementplanning/PensionCredit/DG_10018692

Oldernotwiser

If untaxed income wasn't taken into account, people could have up to £6,000 pa income and claim Pension Credit on top!

DanE2010

I dunno about pension credits but I do know in regards to tax credits it is a non taxable income so no included, some people get confused because after 95 it switched to incapacity benefit and not everyone you talk to on the phone no the distinction between invalidity benefit and incapacity benefit after 1995 - any new claims after then were taxable and do need to be included for tax credits, the person who told you that it is included was probably confused themselves (no uncommon!)

Dont take my word for it though as I dont know much about Pension credits but i would imagine it would be the same as its non taxable - call back to clarify, ask to speak to a supervisor if possible to get a firm answer.

sixtyatlast

Thanks MrsManda,the advisor I spoke to said there was no point in applying for pension credit as my ivb takes me above the minimum income amount.If I did apply for pension credit I know that the pension service will have details of my ivb,but how will I know whether my claim is dealt with by someone who thinks it should n't be included or one who thinks it should.
I can't find anywhere within the regs that gives a definitive ruling on my situation...nor can anyone explain why the Pension Credit calculator specifically says only to include non-taxable income,or why different advisors have conflicting opinions.

Icequeen99

The adviser was correct - Incapacity Benefit is taken into account in full for pension credit regardless of whether it is the taxable or non-taxable kind.

As someone has pointed out above, the situation for tax credits is completely different as it is based on whether it is taxable or not (if it is not then it generally isn't income).

The definitive answer can be found in the State Pension Credit Regulations 2002 http://www.statutelaw.gov.uk/LegResults.aspx?LegType=All+Primary&PageNumber=7&NavFrom=2&linkToATDocumentId=461294&linkToSearchEnacted=0&linkToSearchDay=9&linkToLocale=E%2BW%2BS%2BN.I.&linkToMatchExactLocale=0&linkToSearchMonth=5&linkToSearchYear=2009

In particular, for pension credit, it is income unless excluded. If you look at Regulation 15 it lists the benefits that are not counted as income and Incapacity Benefit isn't one of them therefore it is included.

I would get a full benefits check done by an independent adviser such as CAB.

I have had a look at the pension credit calculator and can see what you mean about taxable income. I think that is very badly worded and I think what it is saying is that for income that is taxable they only need the net figure (not the gross figure). It isn't saying that you should not include non-taxable income. I agree it is misleading though.

IQ

sixtyatlast

Thanks for your help,now I've seen the relevant regs I realise that my ivb should be classed as income.

sunnyone

If you have taken a private pension payout dont forget that those of us still on IVB dont have any deductions made unlike IB where there is a deduction made for any pension over £85pw.

And they havnt yet decided what to do with IVB and SDA claimants when the big switchover is made to ESA.

sixtyatlast

Thanks,I hadn't realised that,but it's something I'll watch out for should my pension reach £85pw.

Robbie64

sunnyone wrote: »

If you have taken a private pension payout dont forget that those of us still on IVB dont have any deductions made unlike IB where there is a deduction made for any pension over £85pw.

And they havnt yet decided what to do with IVB and SDA claimants when the big switchover is made to ESA.

The £85 pw rule only applies to IB claims made from April 2001 onwards.

As for the change from old style IVB / SDA to ESA, unless you are close to retirement age the transition will go ahead with the ESA being treated as taxable income.

sunnyone

Robbie64 wrote: »

The £85 pw rule only applies to IB claims made from April 2001 onwards.

As for the change from old style IVB / SDA to ESA, unless you are close to retirement age the transition will go ahead with the ESA being treated as taxable income.

the last update in Novemebr said that they havent decided what to do with SDA and IVB claimants, I still have transitonal protection from the change to IB and we will have to see what will happen when its decided what will happen with the changeover to ESA.