PIP to be paid - tax implications?

GotToChange

Well, after a long long time (application made 4/9/2017), I have finally - after a Tribunal Hearing on 28/2 been awarded PIP (enhanced daily living and standard mobility). If this is added to ESA (IR), I am almost sure that my income (:o) will be above the tax threshold (which I realise is called Pay as you EARN). Does this mean that I will be liable for tax now?




PS - the award is for disability due to mental health (any physical limitations have come about due to the poor mental health) - so I suppose this is a "success story" of sorts, in case anyone is interested, or might feel encouraged by my outcome.....

fryedslyce

PIP is not classed as taxable income. Plus the lump sum of PIP you receive will be disregarded as capital for 12 months.

GotToChange

fryedslyce wrote: »

PIP is not classed as taxable income. Plus the lump sum of PIP you receive will be disregarded as capital for 12 months.

Thank you... I wasn't sure, as it doesn't seem right somehow.

fryedslyce

Lists all taxable and non-taxable benefits.
https://www.gov.uk/income-tax/taxfree-and-taxable-state-benefits

fryedslyce

Interesting thought that you could legitimately have an income of £525 per week and none of it would be liable for income tax.

£7500 per year Rent a room scheme
£5759 ESA support group
£7558 PIP enhanced daily living + mobility
£6520 Permitted work

= approximately £525 PW

calcotti

GotToChange wrote: »

If this is added to ESA (IR), I am almost sure that my income (:o) will be above the tax threshold

ESA (IR) is also not taxable (whereas ESA (C) is) as per link provided by fryedslyce.

GotToChange

calcotti wrote: »

ESA (IR) is also not taxable (whereas ESA (C) is) as per link provided by fryedslyce.

Thank you - all, for info. Guess I should have looked into it further before asking
I do get a P60 every year, which, if memory serves, states my "income", and I do believe that it says taxable.... so I thought that the addition of the PIP to that would push the amount I receive over a year (let alone, the back payment) over the threshold.

GotToChange

fryedslyce wrote: »

Interesting thought that you could legitimately have an income of £525 per week and none of it would be liable for income tax.

£7500 per year Rent a room scheme
£5759 ESA support group
£7558 PIP enhanced daily living + mobility
£6520 Permitted work

= approximately £525 PW

Wow....
well, I beleve strongly that if I were to try and do some permitted work, they would say I was ineligibile for benefits altogether ---- and this is how the "Benefits Trap".... traps you


That is not to say that I am not incredibly grateful, and soooo thankful to the Tribunal Panel, for doing the thing I had wanted the most (at the initial assessment....); they believed me.

poppy12345

GotToChange wrote: »

Wow....
well, I beleve strongly that if I were to try and do some permitted work, they would say I was ineligibile for benefits altogether ---- and this is how the "Benefits Trap".... traps you

Lots of people do permitted work. As long as the work you do doesn't contradict the reasons you claim ESA then it will be fine.