Administrative Earnings Threshold to rise for Universal Credit.. Help please

calcotti

NedS said:

It shouldn't make any difference at those levels, as £494/month is equivalent to £5928/year, well under the threshold any income tax or NI would be paid.

I agree that it would be unusual for it to make any difference but it’s not impossible. Someone could have other sources of income resulting in tax deductions from wages. It might also be the case if someone has recently applied for UC having previously had well paid employment.

NedS said:?..I would not be at all surprised if the UC system were basing calculations on net earnings.

I wondered that too.

nuanger

NedS said:

nuanger said:

Thanks for that,  the job centre are saying it's my take home pay after tax which puts me just below the threshold and they want me to attend weekly at the job centre.  

How much did you earn in the month and how much tax did you pay?

I earn £850 month,  but the tax said I owe them money and something about my personal allowance wich i didnt understand, so I'm paying  £160 month in tax till it's paid off, which the job centre now says takes me below the threshold

calcotti

They should be ignoring the tax deduction.

huckster

Must admit. Thought net earnings used for AET and CET.

The UC system sets the work groups based on information on the claim at the time a UC statement is issued.  

The regulation 90 section linked to earlier in the thread stated below, indicates that it is slightly more complicated than just looking at gross earnings for one particular assessment period.  The legislation is programmed into the UC system, so if a question is raised about whether someone should be treated as light touch rather than intensive work search, the Job Centre are likely to state they go by what the UC system states.  I suspect any query raised by the Job Centre to the UC policy team that might look into this, would only confirm that the earnings mean the claimant is in intensive work search and therefore Job Centre appointments are required.

6) [F11A person’s monthly earnings are]—

(a)[F12the person’s] earned income calculated or estimated in relation to the current assessment period before any deduction for income tax, national insurance contributions or relievable pension contributions; or

(b)in a case where the person's earned income fluctuates (or is likely to fluctuate) the amount of that income [F13, calculated or estimated before any deduction for income tax, national insurance contributions or relievable pension contributions, taken as a monthly average]—

(i)where there is an identifiable cycle, over the duration of one such cycle, or

(ii)where there is no identifiable cycle, over three months or such other period as may, in the particular case, enable the [F14monthly] average to be determined more accurately

[F15and the Secretary of State may, in order to enable monthly earnings to be determined more accurately, disregard earned income received in respect of an employment which has ceased].

tomtom256

calcotti said:

Is it the computer system that flags up who is subject to conditionality? 

Yes it does. It's all automated. A work coach can override if a claimant is going to meet CET, but we wouldn't override the opposite way.
The system changes the labour marker regime autoatically, based on whatever calculation has been set, wich it has always done, when moving claimants into light touch etc.
All offices now have a to-do to look at and action accordingly.

calcotti

huckster said:

..The regulation 90 section linked to earlier in the thread stated below, indicates that it is slightly more complicated than just looking at gross earnings for one particular assessment period.  

That is true because it permits averaging (which is completely at odds with normal rules for UC). However even if averaging it is obviously it is imperative that the averaging is of of gross amounts. The tax deductions from OP should be ignored and either taken as received or averaged if earnings fluctuate. At the moment it looks as if net figures are being used and that is incorrect.

tifo

When entering earnings manually UC want the net income after tax and NI. So I guess they should also take the same figure through RTI. 

calcotti

tifo said:

When entering earnings manually UC want the net income after tax and NI. So I guess they should also take the same figure through RTI. 

The point though is that for the AET the regulations require the gross earnings to be used as identified earlier in the thread.

Spoonie_Turtle

tifo said:

When entering earnings manually UC want the net income after tax and NI. So I guess they should also take the same figure through RTI. 

That's for self-employment, to work out the UC payment.  Just like the UC payment is worked out on take-home pay for employed earnings.  That's a separate issue from AET/CET. 

NedS

nuanger said:

NedS said:

nuanger said:

Thanks for that,  the job centre are saying it's my take home pay after tax which puts me just below the threshold and they want me to attend weekly at the job centre.  

How much did you earn in the month and how much tax did you pay?

I earn £850 month,  but the tax said I owe them money and something about my personal allowance wich i didnt understand, so I'm paying  £160 month in tax till it's paid off, which the job centre now says takes me below the threshold

Thank you. All you can do is request this be sent to a decision maker and ask them to look at the relevant regulation (cited previously, above). If the system is calculating it incorrectly, you should also ask them to raise an 'ACT' to report the issue. Don't be surprised though if you don't get anywhere - in my experience decision makers only really look at the Advice for Decision Makers guides, and not the actual legislation. If you have a good work coach, you may be able to show them the legislation and get them on board with reporting the issue, although I suspect many will simply not be interested.