ESA eligibility not enough NI contributions?

sarahdh

My employment was terminated last year while I was on sick leave, the last day of my employment was 3rd of October. I have fit notes covering the entire period, and my current fit note expires in March.

I applied for ESA and received a letter stating that ‘we cannot pay you because you have not paid, or been credited with, enough National Insurance Contributions. We have used the tax years ending 5 April 2018 and 5 April 2019 to assess your claim.’

I logged into my HMRC account, and for 2017/18 it says ‘Full Year. You have contributions from National Insurance Credits: 52 weeks’. For 2018/19 it says ‘Full Year. You have contributions from paid employment £163.01; National Insurance Credits: 52 weeks’.

If both years say Full Year, what am I missing? What am I supposed to have to be eligible?

If it helps, in the tax year 2017/18 I was not working, but wasn’t in receipt of any benefits other than child benefit. In 2018/19 I started working part time in October 2018, and that job continued until October 2020.

Also, if it’s a matter of having needed to actually be working during the tax year, when it comes to April of this year do they automatically start using 2018/19 and 2019/20, thus making me eligible?

calcotti

You cannot qualify for ESA based on NI credits alone. You need to have at least 26 weeks of Class 1 contributions from employment (or Class 2 from self employment) in at least one of the years. The balance of the years can be made up with Class 1 or Class 2 credits or contributions.

So in your case in each year you have 52 weeks of credits due to receiving Child Benefit. However these are Class 3 credits and do not count for ESA anyway. In employment you need to be earning at least £120/week to be credited with Class 1 contributions.

Your years are full so will count towards your future State Pension but not for others nenefits.

if you apply now they will use 2018-19 and 2019-20. The switch in years used occurs on the first Sunday in January.

It would be helpful if NI record gave more information about exactly what NI is shown.

sarahdh

Thank you so much for this, I wish they would make it more clear when you are applying! 

I applied back in October last year. They said I can get NI credits, but that was it. If they changed which years they use in January, surely that means I’m eligible now? 

calcotti

sarahdh said:

Thank you so much for this, I wish they would make it more clear when you are applying! 

I applied back in October last year. They said I can get NI credits, but that was it. If they changed which years they use in January, surely that means I’m eligible now? 

How much did you earn per week? 2018-19 appears to be Class 3 credits from your CB which, as already advised don’t count for ESA. What does the 2019-20 record say?

sarahdh

I earned a minimum of £200 per week from the beginning of October 2018 until the beginning of October 2020. My monthly take home varied from around £830 to £1200. My 2019-20 record says ‘Full Year. You have contributions from paid employment: £404.86. National Insurance credits: 8 weeks’.

calcotti

Did you go through a Work Capability Assessment and are you now getting NI credits for Limited Capability for Work?
If so I suggest you ring ESA and ask them if they can reassess your claim against 2018-19 and 2019-20.
If not I think you will need to make a new claim. 
I don’t understand the significance of the monetary amounts quoted in the NI record but based on your earnings figure The 2019-20 year should be OK and I think you will have paid NI on enough earnings in 2018-19 to count for 52 weeks.

sarahdh

I had my work capability assessment over the phone yesterday, and it seemed to go well. I’ll give them a call tomorrow. Hopefully reassessing is something they do, as it would seem a bit harsh to make me stop my claim and make me reclaim.

calcotti

There is a description of the contribution conditions here  https://www.entitledto.co.uk/help/employment-and-support-allowance-contribution-based

For 2018-19 you will need to have earned £5800 (50 x £116) to meet the conditions. From the reference in the record to 8 weeks of credits I now suspect you are short.

sarahdh

Unfortunately with only starting in the October, my total earnings for 2018/19 were £4,868.54, so I’m a bit short. 

The info on that link says ‘in at least one of the last two complete tax years’, and I definitely have in one of the last two complete tax years (I’ve just checked and 2019/20 earnings were £12k+), it’s just that they haven’t used that tax year, they’ve used the two before it instead.

calcotti

sarahdh said:

Unfortunately with only starting in the October, my total earnings for 2018/19 were £4,868.54, so I’m a bit short. 

The info on that link says ‘in at least one of the last two complete tax years’, and I definitely have in one of the last two complete tax years (I’ve just checked and 2019/20 earnings were £12k+), it’s just that they haven’t used that tax year, they’ve used the two before it instead.

You have to have earned in at least one of the years but you still have to meet the conditions in both years. If you claim now they will look at 2018-19 and 2019-20. You meet the required condition for 2019-20. However in 2018-19 you appear to have Class 1 contributions for 42 weeks with the balance made up with Class 3 but the Class 3 don't help with ESA. Therefore it seems you don’t meet the conditions for 2018-19 so don’t meet the ESA requirements.

sarahdh

I just found this, does the ‘aggregate’ mean the average over the last two years? If so that would mean I qualify. Not sure I’m reading it correctly though!:

The second contribution condition

U1036 The second contribution condition is satisfied1 if

1. in the last two complete relevant income tax years before the beginning of the relevant benefit year the claimant has

1.1 paid or been credited with class 1 or class 2 NI contributions or

1.2 been credited with earnings and

2. the earnings factor in each of those years is not less than 50 times the LEL for those last two complete relevant income tax years.

U1037 For the purposes of U1036 2. the earnings factor is the aggregate of the claimant’s earnings factors derived1 from

1. the amount of earnings which did not exceed the upper earnings limit for the last two complete relevant income tax years in U1036 1. on which class 1 NI contributions have been paid or treated as paid and

2. class 2 NI contributions.