Terms & Conditions

[peterdelamothe]

A claimant is receiving Pension Credit (Guaranteed).

1The claimant has a non-dependant who is 24 and receiving JSA (IB) – no non-dependant deduction is being taken due to his age.

2 The non-dependant turns 25 in September 2005.

3 The non-dependant starts work in October 2005 but the claimant does not report this and it is discovered on an intervention in April 2006.

Would any kind person like to suggest when the 26 week rule applies and when the full in-work deduction starts?

[markp]

My humble opinion is that the deferred deduction should take effect from 26 weeks after the change in circs and not the report of it. Therefore I think the earnings related NDD takes affect from April 2006.

The deduction for the age change should be implemented from the 25th birthday as the non dep is an existing non dep.

I assume that your claimant is over 65.

Willing, as ever, to be corrected.

Do I know what I'm doing? The jury's out on that........................

[Anonymous]

Mark might be right – it depends on how you interpret the words “amount” and “increased” in Reg 59(10)(b):

[color=blue:7fd001d235](b) either—
(i) a non-dependant took up residence in the claimant´s dwelling; or
(ii) there has been a change of circumstances in respect of a non-dependant so that the amount of the deduction which falls to be made under regulation 55 (non-dependant deductions) increased.[/color:7fd001d235]

The non-dep’s 25th birthday is certainly a change of circumstance in respect of a non-dep, but does it cause the “amount” of the non-dep deduction to be “increased” from nothing to something, or does it cause the deduction to come into existence for the first time?

In this particular case, it is to the claimant’s advantage to say that the 25th birthday does not fall under para (10)(b)(ii) – because the working rate of deduction is then delayed for the full 26 weeks from October. But for many non-deps such an interpretation would be disadvantageous, because if they stayed on IS/JSA for 26 weeks after their 25th birthday with no further change of circs, the claimant would get no advantage under the 26-week rule.

Swings and roundabouts. I think Mark is more lilely to be rigbht than wrong, because Reg 55(8) says “non non-dep deduction shall be made” for someone under 25 on JSA/IS, as opposed to an amount of nil being set under para (1).

[gerryg]

The wording of the regulation certainly does not make it clear but the policy intent appears to be that the non-dep becoming 25 is such a change. This is from A32/2004.

[quote:4faf80730b]30 From 4 April 2005, amendments to regulations 2(15)(b) and 3(15)(b) (which amend
HB regulation 68(9)(b)(ii) and CTB regulation 59(10)(b)(ii)) provide that the
concession will apply to any change that gives rise to an increased deduction, eg if
the non-dependant moved from IS to work or reached age 25, the increased
deduction would not be made for 26 weeks.[/quote:4faf80730b]

I’d apply the deduction from 26 weeks after the 25th birthday at the rate applicable then.

[peterdelamothe]

This SHOULD be a straight-forward question, but as I expected it is not.

What about the starting work and the fact that we were not notified? When does that impact on the claim? Does it not make a difference (and if it does not, what is the point of interventions for pensioners with non-deps anyway?).

More views please!

[gerryg]

I’m not sure it changes anything.

What did you have in mind, Peter?

[Anonymous]

I would agree with Gerry, that in fact you only allow 1 period of 26 weeks “grace” from a non-dep charge.
For any other period of 26 weeks “grace”, there would have to be a further subsequent change, after the new non-dep charge had been initiated. 8)

[Anonymous]

I agree the late notification doesn’t change anything: neither of these changes was advantageous and so the only possible risk to the claimant of failing to declare the second one promptly is that there has been an overpayment.

I also agree that there is only one 26-week period allowed, and if a second change covered by the 26-week rule affects the same non-dep before the original 26 weeks are up, the second change does not trigger a second, overlapping 26 weeks.

But the issue that remains unclear is whether a non-dep on IS/JSA(ib)reaching age 25 is covered by the 26-week rule, because arguably it does not “increase” the “amount” of an existing deduction. It seems clear from the guidance that such changes are intended to be covered by the rule. If so, the non-dep in Peter D’s case attracts no deduction for 26 weeks from September 05, then attracts a deduction based on earnings from employment immediately (in March).

But if the Regs have been drafted in a way that does not fully meet the policy intention, the first change takes effect immediately and there is a £7.40 deduction from September; but the second change is delayed for 26 weeks and so the deduction stays at £7.40 until April. I think the Regs probably do say this, even if it wasn’t the intention.

[peterdelamothe]

Thanks peter, that is exactly the issues I had in mind.

The other issue is software and whether the systems are reflecting the policy or the law.

As I said earlier, it should all be fairly simple ……

[gerryg]

It’s that old argument again about “when is an increase not an increase”?

This thread has an answer from Adelphi that seems to suggest that the deferral should apply from the 25th birthday.

https://hbinfo.org/forum/viewtopic.php?t=4689&highlight=deferred+deduction

[b:f05511ef22]BUT[/b:f05511ef22] – they seem to then say the opposite when they talk about a rising 18.

So, it’s still anybody’s guess! :15:

[peterdelamothe]

Thanks for all these helpful comments!

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