Universal Credit Appeal Help

MakingLifeMine

On two different occassions, Universal Credit underpaid me. I am a company director and I am registered as an employee of my company.

What my RTI said I earned was completely different to what they said I earned. They had a higher number than I RTI report stated.

This is what they said;

Although you have provided bank statement and a submission from HMRC, this is not sufficient evidence to prove that you did not receive this money. As you are the director of this company the onus is on you or your accountant to report the correct earnings to HMRC.

What my RTI report stated that I earned matched my bank statements.

I am so confused. I don't know what to do now. I want to submit an appeal but other than my business bank statements and my personal bank statements, how else am I meant to prove that I did not receive that money?

I am just devastated because their underpayment has caused me serious problems and now I don't know what else to do.

NedS

Please can you provide the exact numbers involved as they may help people advise you what has happened.

As a director of a company, Universal Credit will likely treat you as being self employed. Have you had a self employment Gateway meeting, and if so, what was the outcome of that meeting?

As Universal Credit will treat you as being self employed, the system will take into account how much profit the business has made during the assessment period (AP), not just what you have decided to pay yourself as a director. The important thing to watch for is that any 'salary' isn't declared as income twice, once through self employed earnings and again through RTI.

For example, say your business has £5,000 of income in the AP, has £2,000 of expenses and pays you £2,000 in salary, it therefore makes £1,000 profit after expenses and wages have been paid. You would report self employed earnings of £1,000 (£5,000 income - £4,000 expenses) and the RTI feed would show your £2,000 salary less any tax, pension and NI paid in the AP. Your total earnings for UC purposes would be £3,000, the combination of your reported self employed earnings and salary the business has paid you reported through RTI. Note how the salary paid has been deduced as a business expense so it is not declared twice as it will also be reported by RTI.

Edited to add:
If you were found to be Gainfully self employed at your self employment meeting and you have been running the business for more than 12 months then the Minimum Income Floor (MIF) will apply. This would be explained in the letter you received telling you the outcome of your self employment meeting. This means UC will assume a minimum level of income for you, equivalent to the number of hours you are expected to be available x national minimum wage for your age (less tax and NI). For someone over 25 years of age expected to be available for full time work this is currently £1144.15 per month. If you have earned less than this in the month, this is the figure UC will use to calculate your entitlement to UC regardless of what your RTI and/or self reported earnings state.

MakingLifeMine

Thank you for your response.

In April, they stated I earned 780, when I earned 500.

In July, they said I earned 735 when I earned 150.

In August I earned 0 and there were no deductions.

i have not had a meeting with anyone and they do know I own a company and I am registered as an employee. My son was under 1. He just turned 1 so I was told that i do not need to have any meetings.The information about minimum levels is new to me. I was completely unaware of this.

They said this information came from my RTI report but it clearly did not. I double checked my records to make sure I did not make any errors and there were definitely no errors.

I have only just gotten back into full time work this week after securing childcare.

calcotti

As a company director you are treated in the same way as a self employed person. This means that you are treated as earning the difference between the income your business receives in the month and the expenses paid by your business in the same period. I would expect UC to require you to submit evidence of these two figures each month. The amount you choose to put through PAYE is irrelevant.

https://www.gov.uk/self-employment-and-universal-credit
"Everyone claiming Universal Credit needs to report their self-employed earnings at the end of each monthly assessment period. This includes company directors, even those paying themselves by PAYE."

In general, if you have been in business for more than 12 months the Minimum Income Floor can be applied. However as you have a child below 3 this will not currently apply to you as you have no work search requirements.

https://www.citizensadvice.org.uk/benefits/universal-credit/on-universal-credit/how-the-minimum-income-floor-works-if-youre-self-employed/

NedS

MakingLifeMine wrote: »

i have not had a meeting with anyone and they do know I own a company and I am registered as an employee. My son was under 1. He just turned 1 so I was told that i do not need to have any meetings.The information about minimum levels is new to me. I was completely unaware of this.

You will need to report that you are self employed as a company director and you will need to report the earnings from your business monthly as calcotti stated.

NedS

With respect to the RTI feed, sometimes mistakes can happen. DWP should be able to tell you exactly which employer(s) reported what earnings and on what dates. It could be that there is a second or other employer(s) reporting against your NI number in error. Sometimes deductions for TAX, NI and pensions are not properly processed.
If the only employer is your company then you should know exactly what information was passed to HMRC when you (or your accountant) completed your salary details online, and if you are able to provide evidence of that combined with a payslip and bank statement showing the payment, then that should be sufficient to raise an RTI dispute. The paragraph you quote in your first post almost makes it sound like DWP believe you have some undeclared income?