Universal credit and private pension contributions

poppy12345

@TMel42 please start your own thread with your question. Asking questions on other peoples threads causes confusion and people often answer the orginal question asked, rather than yours.

calcotti

TMel42 said:

I know this is an old thread but I am having a similar problem with UC and payments in to my private pension. ... I pay a large chunk of money into a private pension (relievable) each month. I also pay the basic amount into a workplace pension (nest). 

I have got to the stage of MR, and the result that has come back that because I pay in to a private pension voluntarily it is not included in the income calculation for the UC income. I am completely stuck as to how to move this forward, and doubting if I am right or not with regards the pension deductions. 

... Can anyone advise whether I should continue with this fight or if indeed UC are correct and the private pension contribution should not be deducted from the income?   

Refer to legislation quoted here
https://forums.moneysavingexpert.com/discussion/comment/75817908/#Comment_75817908
If MR has failed then lodge an appeal to tribunal service. Eventually someone will look at it properly and sort it for you. You are entitled to have the pension contributions taken into account.

You could also refer to this House of Commons guidance
Document Title (parliament.uk), bottom of page 4

Pension contributions
Pension contributions paid into a pension scheme via the claimant’s employer and are being deducted from earnings before tax are disregarded. ..
. If contributions are taken after the earnings have been taxed, the pension contribution is to be deducted from the reported RTI figure.
This may also apply when a claimant pays into a personal pension scheme. 

and

ADM Chapter H3: Earned income - employed earnings (publishing.service.gov.uk)

paragraphs H3170 - H3173

NedS

TMel42 said:

I know this is an old thread but I am having a similar problem with UC and payments in to my private pension. I am a carer so work part time hours, to enable me to work and not be worse off for the privilege I pay a large chunk of money into a private pension (relievable) each month. I also pay the basic amount into a workplace pension (nest). 

I have got to the stage of MR, and the result that has come back that because I pay in to a private pension voluntarily it is not included in the income calculation for the UC income. I am completely stuck as to how to move this forward, and doubting if I am right or not with regards the pension deductions. 

Before making the decision for myself and my partner to move in together, i had an online adviser session with citizens advice who advised there would be no difference between the tax credits amount I was already receiving and being on the UC system. Can anyone advise whether I should continue with this fight or if indeed UC are correct and the private pension contribution should not be deducted from the income?

   

You are 100% correct and the law is on your side. If you are unsuccessful with your MR then you will need to follow the process and appeal. You should cite the relevant UC regulations (UC Regulation 55(5)(a)) in your appeal. DWP may make all kind of other arguments in the MR (such as deprivation of income) but none of them are relevant. Your appeal paperwork will eventually be sent to DWP legal department to respond, and I suspect at that point they will immediately concede the case and decline the opportunity to go to court.

steely333

NedS said:

TMel42 said:

I know this is an old thread but I am having a similar problem with UC and payments in to my private pension. I am a carer so work part time hours, to enable me to work and not be worse off for the privilege I pay a large chunk of money into a private pension (relievable) each month. I also pay the basic amount into a workplace pension (nest). 

I have got to the stage of MR, and the result that has come back that because I pay in to a private pension voluntarily it is not included in the income calculation for the UC income. I am completely stuck as to how to move this forward, and doubting if I am right or not with regards the pension deductions. 

Before making the decision for myself and my partner to move in together, i had an online adviser session with citizens advice who advised there would be no difference between the tax credits amount I was already receiving and being on the UC system. Can anyone advise whether I should continue with this fight or if indeed UC are correct and the private pension contribution should not be deducted from the income?

   

You are 100% correct and the law is on your side. If you are unsuccessful with your MR then you will need to follow the process and appeal. You should cite the relevant UC regulations (UC Regulation 55(5)(a)) in your appeal. DWP may make all kind of other arguments in the MR (such as deprivation of income) but none of them are relevant. Your appeal paperwork will eventually be sent to DWP legal department to respond, and I suspect at that point they will immediately concede the case and decline the opportunity to go to court.

Hi NedS in your comments you stated deprivation of income is not relevant? I am aware of notional capital and in my case it actually supports me but if your not carefull it is relevant, can i ask why you say it is irelevant? ie any documents/proof you may have?
As im going through this same process im at the MR stage and do have my MP on board. 

calcotti

steely333 said: Hi NedS in your comments you stated deprivation of income is not relevant? I am aware of notional capital and in my case it actually supports me but if your not carefull it is relevant, can i ask why you say it is irelevant? ie any documents/proof you may have?

As im going through this same process im at the MR stage and do have my MP on board. 

You can read about deprivation of income 
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/935544/admh3.pdf
paragraph H3200 onwards.

My take on this is that deprivation of income can occur when someone chooses not to receive income that might otherwise be due. 
In your case you have not deprived yourself of income. You have received income and then chosen to spend some of it by paying into a pension scheme which is an expressly permitted expense/deduction.

steely333

Hi calcotti
I do agree with most of what you say and with this and actual DM guidlines on notional capital will use it in my case if they site this at any time, but will point out it does say you cannot deprive yourself of income to gain a higher UC payment which would be the case...or would it? As you are allowed to pay for a service and i believe a pension would be classed as a service? Just like the state pension service we pay into?.
Also in the DM guidelines it actually protects you if you were already contributing into a pension BEFORE claiming extra UC and told the DWP and they REFUSED to allow it and you continued to pay into your pension anyway, then the guidelines say they cannot use notional capital rules against you.

calcotti

steely333 said:

Also in the DM guidelines it actually protects you if you were already contributing into a pension BEFORE claiming extra UC and told the DWP and they REFUSED to allow it and you continued to pay into your pension anyway, then the guidelines say they cannot use notional capital rules against you.

Have you got a reference for that - would be useful to know and I hadn't spotted it.

steely333 said:

..and actual DM guidlines on notional capital 

We are discussing income here rather than capital - not sure if this was a typo or confusion about the relevant rules.

steely333

Hi calcotti.
I believe income is treated as Capital or at least it says so.

You can read all of this but pay particular attention to H1842

calcotti

steely333 said:

Hi calcotti.
I believe income is treated as Capital or at least it says so.

You can read all of this but pay particular attention to H1842

When money is received it is either income or capital. It cannot be both (except in the case of surplus earnings where it appears it can be - but that is not relevant to the matter under discussion). Income only becomes capital if there is money left after the period for which the income was paid has ended. So if you are paid £1000/month that is income. If you only sped £900 during the month then £100 becomes capital at the end of the month.

Nothing in chapter H1 is relevant when considering how much income should be taken into account.

steely333

It wont let me post links yet.

So go to GOV.UK website its advice for decision makers you need H1 CAPITAL then go to H1842