Universal Credit (JSA) and Working Tax Credit?

Noseybonk1986

Woargh

What a carry on. All this UC carry on has battered my head. :rotfl:

As i said, i put the figures in to the calculator before i submitted my WTC claim, as it told me i was still entitled or likely to be in my area. Now you explain how the UC claim works once going into employment, i realise why this has happened.

I preferred it the old way. Clap clap IDS!!

Mersey_2

Noseybonk1986 wrote: »

this just seems deliberately confusing!!

The only way i am understanding this right now is that due to me not 'signing off' a UC claim as a jobseeker, it stays on my record for 6 months, even if i aren't receiving any money in benefit, that means no WTC entitlement. If so, they kept that quiet that's for sure.

They could still class that as still claiming UC so i am not allowed WTC.

Yes and no.


Whilst it's true that UC claims are not closed - in the same way JSA claims were - it isn't this underlying claim or 6 month rule that is barring you.


What is - is another rule: once a claimant has claimed UC, they are barred from reverting to any legacy benefits, including WTCs.


However, there are a couple of exceptions, including if a person was wrongly told by the DWP to claim UC when they should in fact have claimed Tax Credits, or they were ineligible for UC (but this was only discovered later ie because they were self-employed and so did not meet one of the UC gateway conditions).


I have just helped a claimant successfully claim Tax Credits - after he was wrongly told to claim UC - and he met the same obstacles you did at first and it took several months to resolve.


Let me know if you need the relevant Regs and I'll post them on here.

Mersey_2

Noseybonk1986 wrote: »

Thanks for the response.

I'm pretty confident i aren't earning too much though either, as i am contracting via an agency at moment and earned next to nothing in this current tax year.

If you haven't done so already - ask HMRC if you are due a Tax Rebate for any of the last few years.

theronstar

I'm joining this thread late in the day but hope I have something useful to say.

The OP's case has shown one of the advantages the government has gained through replacing the legacy benefits with Universal Credit.

There is something called, the 'earnings taper' and this refers to the rate at which any UC payments a claimant receives, are reduced, with each extra £ that they earn.

So, a claimant who earns £0 will get full UC and a claimant earning above their personal allowance (the personal allowance varies depending on individual circumstances) will see their benefit reduce with each extra pound that they earn.

What has already been said (but I'll include it in here to illustrate my point), is that the OP has a high enough income from work, which renders them ineligible for any UC payments.

It may be worth the OP enquiring with the UC helpline or at the Jobcentre about their actual personal allowance. We have no way of knowing the OP's exact circumstances, and they go through them with a benefits officer, there is a remote chance that the OP may be eligible for some UC.

Though I will now make my point about why UC will likely be to the government's advantage.

The earnings taper can be adjusted whenever the government wants to do so. So for now it is set at 65p per each extra £ earned (and in April 2017 the taper will change to 63p per each extra £ earned).

With the legacy benefits, the tapers were different with respect to each individual benefit and thus were harder for the government to tamper with. Now, it only needs to be done once.

It is said to create a situation where some benefits claimants are now 'worse off' under UC than they were under the legacy benefits.

Unless, the OP can get UC to recalculate his/her personal allowance, and get some UC, even though they are working, then the OP is likely to be one of these worse off claimants.

Icequeen99

Mersey wrote: »

Yes and no.


Whilst it's true that UC claims are not closed - in the same way JSA claims were - it isn't this underlying claim or 6 month rule that is barring you.


What is - is another rule: once a claimant has claimed UC, they are barred from reverting to any legacy benefits, including WTCs.


However, there are a couple of exceptions, including if a person was wrongly told by the DWP to claim UC when they should in fact have claimed Tax Credits, or they were ineligible for UC (but this was only discovered later ie because they were self-employed and so did not meet one of the UC gateway conditions).


I have just helped a claimant successfully claim Tax Credits - after he was wrongly told to claim UC - and he met the same obstacles you did at first and it took several months to resolve.


Let me know if you need the relevant Regs and I'll post them on here.

I'd like to see those regs. In a live service area, such as the one the OP is in, there isn't anything stopping them claiming tax credits again other than the 6 month rule

see http://revenuebenefits.org.uk/universal-credit/guidance/who-can-claim-universal-credit/tax-credits-and-uc/#Treated%20as%20entitled%20to%20tax%20credits

Interested if you can point to the regs that say anything else for live service.

IQ

Mersey_2

There is, sadly - once a claimant has been in receipt of UC, they cannot revert to any legacy benefits such as JSA or WTCs (I think it was laid in an SI - but it was also confirmed to the DWP Select Committee when an MP asked this of the Permanent Secretary.)


The only exceptions are official error or maladministration ie if a claimant was wrongly told that, 'there's no such thing as Tax Credits, so apply for UC' [as sadly 2 JCPs have admitted they told claimants in 2016].


The authority for this is Article 3A of the no.9 Order:


The Welfare Reform Act 2012 (Commencement No.9 Transitional and Transitory Provisions and Commencement No.8 and Saving and Transitional Provisions (Amendment) Order 2013.


So it isn't just the 6 month rule - ie if still under the UC regime - that prevents claimants from claiming Tax Credits or JSA.


Indeed, most local authorities and JCPs appear to use the same circular/update [the effect being - check if a claimant has claimed UC previously: if so, direct them to claim housing costs within UC again]


I have no idea what authority HMRC cite though (other than 'you have a UC claim'). From what the OP said staff there are still getting to grips with the implications of UC claims.

Icequeen99

Mersey wrote: »

There is, sadly - once a claimant has been in receipt of UC, they cannot revert to any legacy benefits such as JSA or WTCs (I think it was laid in an SI - but it was also confirmed to the DWP Select Committee when an MP asked this of the Permanent Secretary.)


The only exceptions are official error or maladministration ie if a claimant was wrongly told that, 'there's no such thing as Tax Credits, so apply for UC' [as sadly 2 JCPs have admitted they told claimants in 2016].


The authority for this is Article 3A of the no.9 Order:


The Welfare Reform Act 2012 (Commencement No.9 Transitional and Transitory Provisions and Commencement No.8 and Saving and Transitional Provisions (Amendment) Order 2013.


So it isn't just the 6 month rule - ie if still under the UC regime - that prevents claimants from claiming Tax Credits or JSA.


Indeed, most local authorities and JCPs appear to use the same circular/update [the effect being - check if a claimant has claimed UC previously: if so, direct them to claim housing costs within UC again]


I have no idea what authority HMRC cite though (other than 'you have a UC claim'). From what the OP said staff there are still getting to grips with the implications of UC claims.

I have to disagree and say you are wrong on this. I have linked to the summary here http://www.legislation.gov.uk/uksi/2013/983/introduction/made

The only people in a live service area who can't claim tax credits are 'UC claimants'. A UC claimant is defined - and once you are outside of the 6 months period then the OP would not be a UC claimant and could claim tax credits.

I think if you are an adviser then you might want to check the position with someone - perhaps the CPAG adviser line who can explain it to you.

There is no legislation stopping a tax credit claim in a live service area if the person is not a UC claimant.

Turning it around - let's say the OP stays in work for 7 months (so outside of the 6 month period) and then he has a child and wants to claim CTC - you are saying that he wouldn't be able to because at some point in the past he claimed UC - but actually he couldn't reclaim UC because he won't meet the gateway conditions (assuming he isn't in districts 1 to 28 who do accept children in the gateway conditions) at that new point.

It's the Lobster pot principle. See also this article from CPAG http://www.cpag.org.uk/content/universal-credit-full-steam-ahead (at the end)

Also, if you were correct then the 6 month rule would be rendered useless. The reason they brought it in for 2015 was because of the PQ on people withdrawing from the system.

IQ

Mersey_2

Icequeen99 wrote: »

I have to disagree and say you are wrong on this.

The only people in a live service area who can't claim tax credits are 'UC claimants'.

There is no legislation stopping a tax credit claim in a live service area if the person is not a UC claimant.

Turning it around - let's say the OP stays in work for 7 months (so outside of the 6 month period) and then he has a child and wants to claim CTC - you are saying that he wouldn't be able to because at some point in the past he claimed UC - but actually he couldn't reclaim UC because he won't meet the gateway conditions (assuming he isn't in districts 1 to 28 who do accept children in the gateway conditions) at that new point.

It's the Lobster pot principle.

IQ

I am not wrong in what I stated (as it's merely the current position and not my opinion), as I have seen this practice happen twice in the past 12 months.


I agree with para 2 - however the DWP and some councils are interpreting that to mean...if ever claimed UC.


Yes, I realise there is no legislation on that point re TCs, which is why I said I have no idea what HMRC are citing as a basis for their current actions (in refusing WTCs to previous UC claimants). But then I'm aware that HMRC also wrongly applied a false test re the self-employed new applicants for WTCs last year [by simply looking at low earnings], so errors in the form of incorrect practice being used is not uncommon in HMRC.


I didn't refer to child tax credits at all.


Indeed, it is the lobster pot - once in, you cannot escape from UC [is the rule they are applying] and the Rightsnet forum has 2 other such examples of this practice being applied in the North West.


I agree with you that it shouldn't happen - I am merely explaining the current practice by councils and the DWP.


I am a solicitor, but the case I referred to was one where I acted pro bono (assisting with an appeal and filing two complaints) on behalf of a local claimant. I had to involve the DWP COO and as I said it took several months in order for the local authority and JCP to admit that their practice had been incorrect (although in that case it was the JCP who told the claimant they could no longer claim Tax Credits in his area so advised him - wrongly - to claim UC. Once he had, his claim for TCs was refused, even though he was never entitled to UC as he is self-employed!)


I imagine it's simply that there aren't many examples (yet) of former UC claimants who claimed that benefit over 6 months ago - who then attempt to claim HB or TCs - who have been faced with this problem. But the DWP have promised to write to the MP who raised it with clarification.

Alice_Holt

I think the above illustrates how complicated UC is.
At that's before we get to the administration of it!