Terms & Conditions

[Martin Giles]

Applicant on SMP from December 2005 submits new claim May 2006.
She receives Tax Credits but not extra 16 hours premium.

As she not in remunerative work at date of claim is SMP taken into account in full with no earnings disregard ar should she still be entitled to the Lone Parent £25.00. ?

[Kevin D]

Unless something has changed, my understanding is that there are two separate issues, albeit arising out of exactly the same position:

1) remunerative work

2) the nature of the income

In short, the £25 disregard is allowed. Reasoning as follows:

The clmt is not in remunerative work [[b:a5f2e0e294]HBR 6(7)[/b:a5f2e0e294]].

However, the income counts as earned income [[b:a5f2e0e294]HBR 35(1)(i)[/b:a5f2e0e294]].

As the income is earned income, [b:a5f2e0e294]HBR 36(2)[/b:a5f2e0e294] provides that the disregards in [b:a5f2e0e294]Sch 4 (paras 1 – 14)[/b:a5f2e0e294] shall apply. [b:a5f2e0e294]Para 3[/b:a5f2e0e294] states that a disregard of £25 applies to a lone parent.

As can be seen, the issue of “remunerative work” is not relevant to the issue of this specific disregard.

Regards

[Anonymous]

Not sure if this helps as I was querying the issue of disregards last week. The reply is as follows:

Your email has been forwarded to me to respond regarding the disregards.

This particular part of legislation is rather complicated and does present problems for decision makers.

Reg 35 defines earnings which includes both SSP and SMP. This has the effect that SSP and SMP are treated as earnings so the disregards will apply.

If the claimant is continues to receive Working Tax credits, those who are off work sick or on maternity continue to receive the disregards.

The basic qualification for a higher earnings disregard is that the claimant is in remunerative work – para 17 of Sch 4 .

Paragraph 17 effectively gives two disregards :

The higher disregard is to help people working 30 hours or more who qualify (or would qualify if they claimed) for WTC. The 30 hour element of WTC applies to people aged 25 or over without children and who are not disabled. This is the reason why para 17 (2) is included as it gives the qualifying conditions for the 30 hour element and where para 17(2)(a) says ”to whom regulation 20(1)(c) of the Working Tax Credit Regulations applies” this would include the people in
17(2)(b)(i).

The disregard in Paragraphs 17 (b) (iii) (a ) provide a work incentive for other groups, such as lone parents and people with children, who work 16 hours or more a week. They will not qualify for the higher earnings disregard because of the exclusion in para (5) of Reg 6. i.e they are not treated as being in remunerative work (Reg 6 of the HB regs).

As you are aware, the local authorities are required to determine questions of fact and law in individual cases as part of their overall responsibility for the day to day administration of the Housing Benefit scheme, taking account of the relevant caselaw and consulting their own advisors where appropriate. This Department can only give general advice and guidance on that interpretation on the law. You should bear in mind that my comments are based on the information you have provided in your email, and might not apply in different circumstances, but I hope you will find them helpful.

Hope this helps.

[Author]

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