Back payment widows parents allowance

Cazmarie80

I received a back payment from DWP for widows parents allowance due to the recent changes to the law meaning I am eligible for the allowance. It’s been backdated to 2018, however tax credits have taken it as an income for this year and not over 4 years and I’m now going to be around £200 a month worse off and I’ve now found out that I have to give most or even all of the back payment I recieved to the council because they said because over the overpayment it means they paid me too much in housing benefit since 2018! So basically I’ve been given a lump sum which I now have to pay to the council and I’ve lost £200 a month in tax credits. How is this fair?I don’t know what to do.

sheramber

https://www.gov.uk/bereavement-support-payment/what-youll-get

If you get benefits

Bereavement Support Payment will not affect your benefits for a year after your first payment. After a year, money you have left from your first payment could affect the amount you get if you renew or make a claim for another benefit.

It should not be counted as income for tax credits. 

https://www.legislation.gov.uk/uksi/2023/134/made

https://www.litrg.org.uk/tax-guides/bereavement/what-effect-death-state-benefits-and-credits#:~:text=Bereavement support payment is non,as capital for UC purposes.

It is not counted as income for tax credits or universal credit, however any amount of the one-off payment left over after 12 months will be counted as capital for UC purposes.

calcotti

Sheramber, your comments refer to BSP.  OP has referred to Widows Parents Allowance which was prior to BSP. That’s a different benefit which had different rules so I don’t think the BSP rules are relevant. 

OP, I can’t recall how late payment of DLA payments is now being applied and I haven’t got time to check that immediately,

HillStreetBlues

Have found this link
https://www.housingsystems.co.uk/News/News

According to that  the payment should be classed as capital so the council shouldn't be asking for back payment for HB

Any retrospective payment they receive will be treated as capital and ignored for 52 weeks / 12 months for Universal Credit, Housing Benefit, Income Support, Income-Related ESA and Income-Based JSA. It will not be treated as income in the period for which it is being paid so will not affect their previous entitlements.

 
But for Tax Credit it is classed as pension income in the period it was paid

For Tax Credits, Bereavement Support Payment is ignored but Widowed Parent’s Allowance is treated as pension income for the tax year in which it is received.

Further info
https://www.legislation.gov.uk/uksi/2023/134/made

Amendment of the Housing Benefit Regulations 2006

7.  In Schedule 6 to the Housing Benefit Regulations 2006 (capital to be disregarded)(31)—

(a)after paragraph 9A insert—

“9B.  Any payment of a widowed parent’s allowance made pursuant to section 39A of the Act (widowed parent’s allowance)—

(a)to the survivor of a cohabiting partnership (within the meaning in section 39A(7) of the Act) who is entitled to a widowed parent’s allowance for a period before the Bereavement Benefits (Remedial) Order 2023 comes into force, and

(b)in respect of any period of time during the period ending with the day before the survivor makes the claim for a widowed parent’s allowance,

but only for a period of 52 weeks from the date of receipt of the payment.”;

(b)in paragraph 62—

(i)the existing text becomes sub-paragraph (1);

(ii)after that sub-paragraph insert—

“(2) Where bereavement support payment under section 30 of the Pensions Act 2014 is paid to the survivor of a cohabiting partnership (within the meaning in section 30(6B) of the Pensions Act 2014) in respect of a death occurring before the day the Bereavement Benefits (Remedial) Order 2023 comes into force, any amount of that payment which is—

(a)in respect of the rate set out in regulation 3(1) of the Bereavement Support Payment Regulations 2017, and

(b)paid as a lump sum for more than one monthly recurrence of the day of the month on which their cohabiting partner died,

but only for a period of 52 weeks from the date of receipt of the payment.”.

I can't seem to find any reference to Council Tax

Dazed_and_C0nfused

And don't forget there will be income tax to pay on it as well.

Assuming your taxable income is sufficient in each year for tax to be due.