I B and Bonus

jimmo

My wife was pensioned off on ill health grounds in August 2006.
Since then she has been receiving a small pension and I B at the full rate, currently £162.70 per fortnight. Her pension is only marginally below the limit before I B gets restricted.
Out of the blue this week she has received on 31/7/07 a payment of her share of the annual bonus payable by her former employer.
In round figures she had a gross payment of £400. After basic rate tax and NI she got £300.
Effectively that was money earned from April 2006 to August 2006 but not paid until July 2007 but my fear now is that it will be taken as earnings for July 2007 and wipe out her IB for the month.
Am I right?
Can we argue that the payment relates to a period of earning before she started to claim IB and should not be taken into account?

healy

It should not affect her IB, it is only regular Pension payments over £85 per week that reduce IB.

seven-day-weekend

IB is not means-tested apart from income over £85 from personal/occupational pensions, so the bonus should not affect it (as healy has said). Even if your pension is over this amount the IB is reduced 50p for every £1 over £85, not £1 for £1.

jimmo

Thanks to both healy and seven day weekend. Just as an afterthought, any chance of her reclaiming the N I deducted?

For tax purposes whilst it was earned in 2006/07 it is chargeable for 2007/08. Anyway she is liable at basic rate in both years and the tax deducted is correct.

Is it the same for NI?

Happy to post as a separate question if it helps.