Universal Credit & salary sacrafice

rjw273

First of all am i right in thinking that Universal credit is calculated based on your gross earnings?

Lets say i am paid £1500 per month from employment and pay £100 per month into a smarter pension (where the £100 is taken before Tax and NI are calculated). Does that mean UC would be calculated on £1400 earnings?

xylophone

https://revenuebenefits.org.uk/universal-credit/guidance/entitlement-to-uc/what-is-income-for-uc/

Below seems relevant.

UC is generally based on net income and therefore from the claimant’s employed earnings can be deducted:

Any relievable pension contributions made to a registered scheme
Income tax or national insurance contributions paid in the assessment period in respect of those employed earnings
Any sums withheld under a payroll giving scheme under Part 12, ITEPA 2003.
Full details of employed earnings can be found in ADM Chapter H3.

sazrun

dumb question i know but would you even get UC on that level income?

Ineededaname

sazrun wrote: »

dumb question i know but would you even get UC on that level income?

Quite possibly, dependant on the elements they are claiming.

phoenix1837

I get tax credits and my take home is £1400. I get the child element of it but nothing else.

Tomsdottir

Income from earnings for UC is your gross earnings minus
-income tax
-national insurance
-any contribution you make towards a personal or occupational pension scheme
- charity payments under a payroll giving scheme. (This rule is fund in the Universal Credit Regulations 2013, reg 55(5))
The DWP summarizes this information for their decision makers in the ADM - google "DWP Advice to decision makers" and then go to Chapter H3, para H3170.