Tax rebate and universal credit

calcotti

baconandegg said:

Sorry! So just to clarify - if he took the £10k during an assessment period, we wouldn't get any UC payments that month and not be penalised for using some of the £10k  to pay down the credit card debt (after paying eg rent). If he states he has done this in his journal and provides evidence if required, will this be enough to ensure in the following assessment period our UC payments would return to what they were in the assessment period prior to the one involving the £10k payment?

UC payments will not return to normal the following month because of the surplus earnings rules. A sum of £10,000 treated as earnings could affect two or three assessment periods depending on what your maximum UC entitlement is and whether or to you have a work allowance. Refer to the posts by poppy and myself on 3rd August.

What is your maximum UC entitlement? Do you have a work allowance (you will have one if your claim includes children or either of you has Limited Capability for Work)? Does your claim include help with rent.

NedS

calcotti said:

baconandegg said:

Sorry! So just to clarify - if he took the £10k during an assessment period, we wouldn't get any UC payments that month and not be penalised for using some of the £10k  to pay down the credit card debt (after paying eg rent). If he states he has done this in his journal and provides evidence if required, will this be enough to ensure in the following assessment period our UC payments would return to what they were in the assessment period prior to the one involving the £10k payment?

UC payments will not return to normal the following month because of the surplus earnings rules, A sum of £10,000 treated as earnings could affect two or three assessment periods depending on what your maximum UC entitlement is and whether or to you have a work allowance. Refer to the posts by poppy and myself on 3rd August.

If future payments are to be affected due to surplus earnings, a note will automatically be posted to your journal by the system confirming that.

baconandegg

Our maximum UC entitlement is £1485 a month, plus I receive £492 contributions based ESA. Our claim includes help with rent. Our work allowance is £292. So, Our assessment periods start on the 18th of each month. So, if a 10k tax rebate is taken on say the 20th what would be the impact on UC as in how many months afterwards would we not receive UC payments and would we actually have to close our claim and start a new one, in which case, after how many months would we be allowed to do this?

calcotti

Your UC is reduced to nil if you earn £2649.14 in an AP (£1485 / 63% + £292)
if you receive £10,000 in AP 1 then £2,649 is used, £7,451 is left. UC payable is nil.
£2,500 is ignored. £4,951 remains.
In AP2 UC is again nil. £2,649 is used, £2,302 remains.
£2,500 is ignored. Nothing remains.
In AP3 full UC is payable

Normally as soon as you have a nil entitlement the claim is closed. You then have to log in to your UC journal and make a rapid reclaim. In the case of surplus earnings it is essential to do this otherwise the surplus earning just sit there for up to six months and will be taken into account whenever you claim within this period. At the moment however your claim should be kept open without you having to reclaim. Technically the you are treated as if you had made a reclaim without actually having to do so rather than the claim kept open.

[Question for anyone with inside information re the last point. Normally when a claim is closed and a rapid reclaim made this wipes the previous claim history (inexcusably is my opinion). Now that claimants are treated as if they had reclaimed without actually reclaiming does the claim still get closed and reopened, wiping the history, or does it just stay open and preserve the history?]

baconandegg

Thank you, that's very helpful info.

calcotti

baconandegg said:

Thank you, that's very helpful info.

Can I just check that I interpreted you earlier post about benefit income correctly. I read it that you receive UC of £1485 plus ESA of £492 making a total benefit income of £1977 (which is your maximum UC entitlement amount).

TheShape

calcotti said:

[Question for anyone with inside information re the last point. Normally when a claim is closed and a rapid reclaim made this wipes the previous claim history (inexcusably is my opinion). Now that claimants are treated as if they had reclaimed without actually reclaiming does the claim still get closed and reopened, wiping the history, or does it just stay open and preserve the history?]

Do you mean the payment history/statements related to the claim?

calcotti

TheShape said:

calcotti said:

[Question for anyone with inside information re the last point. Normally when a claim is closed and a rapid reclaim made this wipes the previous claim history (inexcusably is my opinion). Now that claimants are treated as if they had reclaimed without actually reclaiming does the claim still get closed and reopened, wiping the history, or does it just stay open and preserve the history?]

Do you mean the payment history/statements related to the claim?

Yes.