Universal credit and one-off income

somersetperry

Hi, asking on behalf of someone who is on Universal Credit with no regular income due to chronic MH problems. However they are about to receive a one-off sum from a previous self-employment of several thousand pounds.  This will be the only income they receive this year.  How will this be treated for UC?  I think they were employed by their own company rather than self employed.  Their additional issue is that they are in rent arrears and need the money to clear the arrears to avoid being evicted.  They don't have any savings.  Thanks for any help and advice.

Northern_Wanderer

How much is the one-off payment for? How much are the rent arrears?

Yamor

If it would have been genuine self-employment, and they were just being paid now for work done some time ago, then it would have counted as earned income now.

However, you say they worked via a limited company. In that case, it is possible this money is a dividend being paid out by the limited company, which received the money some time ago. If so, it would not count as income for UC.
We would need to know more details about the payment in order to know for certain.

From a capital perspective, if it is used immediately to pay off debt, then that should be fine, although depending to the answer to the income question, it may be necessary to use it up before the end of the Assessment Period in which it is received.

somersetperry

I have a bit more information:
I believe they were self employed and the income is an annual ongoing commission type payment based on consultation work done previously.  The income will be around 4k this year in total (though coming from more than one source) and will be received in April.  An agreement has been made with the landlord to repay 4k of the outstanding rent though the outstanding amount is higher I believe.
They receive LCWRA (?) as a top up to UC and have been led to believe that this will be jeopardised by the income.
Thank you again.

Yamor

Then it should count as self-employed income in the AP in which it is received.
Receiving the income will not in itself cause them to lose their LCWRA status, but there is a possibility that having earned income of that level may prompt DWP to reassess them.

born_again

somersetperry said:

Hi, asking on behalf of someone who is on Universal Credit with no regular income due to chronic MH problems. However they are about to receive a one-off sum from a previous self-employment of several thousand pounds.  This will be the only income they receive this year.  How will this be treated for UC?  I think they were employed by their own company rather than self employed.  Their additional issue is that they are in rent arrears and need the money to clear the arrears to avoid being evicted.  They don't have any savings.  Thanks for any help and advice.

Is UC aware of this?

Northern_Wanderer

born_again said:

somersetperry said:

Hi, asking on behalf of someone who is on Universal Credit with no regular income due to chronic MH problems. However they are about to receive a one-off sum from a previous self-employment of several thousand pounds.  This will be the only income they receive this year.  How will this be treated for UC?  I think they were employed by their own company rather than self employed.  Their additional issue is that they are in rent arrears and need the money to clear the arrears to avoid being evicted.  They don't have any savings.  Thanks for any help and advice.

Is UC aware of this?

OP said it was "commision for work done previously" so it does not sound like they are doing the work now.

born_again

Northern_Wanderer said:

born_again said:

somersetperry said:

Hi, asking on behalf of someone who is on Universal Credit with no regular income due to chronic MH problems. However they are about to receive a one-off sum from a previous self-employment of several thousand pounds.  This will be the only income they receive this year.  How will this be treated for UC?  I think they were employed by their own company rather than self employed.  Their additional issue is that they are in rent arrears and need the money to clear the arrears to avoid being evicted.  They don't have any savings.  Thanks for any help and advice.

Is UC aware of this?

OP said it was "commision for work done previously" so it does not sound like they are doing the work now.

I meant in terms of
I think they were employed by their own company rather than self employed.