UC transitional protection stopping after 3 months earning below threshold - does this apply to those with no work requirements?

Claimant being migrated from Tax Credits to UC at the minute. Working part time and likely to qualify for substantial transitional protection as she had been receiving disabled worker element. However she’s considering giving up work and would qualify for the carers element for looking after her son who receives PIP daily living. Does anyone know if she would still be subject to the loss of transitional protection after 3 months even though she would no longer have work requirements as a carer?

Yes, if her earnings in her first AP are over the AET, then she would lose TP after 3 consecutive APs with earnings under the threshold, even though she has no work requirements.

Thank you for the swift reply. What if the claimant earned less than the threshold in her first UC assessment period?

Then this provision would never affect them.

A claimant is treated as having earned income equal to or more than their threshold in any assessment period in which the minimum income floor applies to them or in which it would apply were it not for their falling into a start-up period so if the client is self-employed, will their TP end after 3 monthly assessment periods with low earnings even though they were not earning anything when they moved from tax credits as a disabled worker?

Is this the kind of case you have in mind:

- Self employed and trying to earn, but no profit at the point of migration
-  Not going to ask for a WCA and no LCW to carry over from legacy benefits
- Treated as gainfully employed by UC, and therefore in scope for the MIF in 12 months’ time
- Treated as having earnings above the threshold in AP1 by virtue of Reg 56(3) which you have paraphrased in your post

And you are asking whether there is a risk that those deemed earnings will drop out of the UC assessment at any stage, triggering the end of transitional protection.  Right?

I think the answer is yes, if UC decides the claimant is no longer gainfully employed, which in turn would disapply Reg 56(3).  Or the claimant might be assessed as having LCW, which would also disapply Reg 56(3) as I read it because the start-up period would no longer be the only thing preventing the MIF from applying.  But the flipside of that would be no MIF either, which might be to the claimant’s net advantage.  If losing both the MIF and transitional protection works out advantageously, the first day of the 13th AP would be a good day to start presenting fit notes, and/or to jack in the s/e and seek work.

That’s exactly the scenario. My thoughts were:

- Self employed and trying to earn, but no profit at the point of migration
-  Not going to ask for a WCA and no LCW to carry over from legacy benefits
- Treated as gainfully employed by UC, and therefore in scope for the MIF in 12 months’ time
- Treated as having earnings above the threshold in AP1 by virtue of Reg 56(3)

Client has disabilities but doesn’t think GP will provide a fit note (refused in past)
Wants to be counted as self-employed to avoid work-related requirements for 1 year so wants to be counted as gainfully self-employed, however this means the MIF will apply and transitional protection will end after 3 months.

Client needs to weigh up what’s worse - losing TP after 3 months or having work-related requirements from start?

The MIF isn’t going to affect transitional protection.  What will scupper transitional protection is becoming exempt from the MIF for a reason other than being in a start-up period, because that will mean the claimant is no longer treated as having earnings above the threshold for transitional protection purposes under Reg 56(3).

If the claimant is treated as having earnings for the purpose of Reg 56,  the UC calculation won’t include those earnings.  The calculation of the transitional element will include whatever income was used to calculate WTC or other legacy benefits, the calculation of UC for real at the end of AP1 will use whatever earnings have been reported during that month.  Earnings the claimant is treated as having for the purpose of Reg 56 are only relevant to the question whether there has been a three-month cessation.

If I’m right abut that, the ideal time line for your client would be:

- Present as self-employed in AP1 in order to be exempt from conditionality. Reg 56(3) kicks in.
- Have a 12-month start-up period in which no earnings are taken into account, but transitional protection survives because Reg 56(3) applies every month
- When the end of the start-up period comes around, it’s decision time: abandon self-employment and submit to full conditionality, which means no TP after three months but no MIF after three months either; or accept the MIF to keep the TP.

Ah! So being treated as meeting MIF means that the actual low earnings don’t affect TP?

That’s how I read it.  Here is the key extract from Reg 56, with important bits highlighted

(3) For the purposes of paragraph (2)—

(a) references to the amount specified in regulation 99(6)(a) and 99(6)(b) respectively of the Universal Credit Regulations are to the amount that was applicable on the first day of the award; and

(b) a claimant is to be treated as having earned income that is equal to or more than the single administrative threshold and the couple administrative threshold respectively in any assessment period in respect of which regulation 62 (minimum income floor) of the Universal Credit Regulations applies to that claimant or would apply but for regulation 62(5) of those Regulations (minimum income floor not to apply in a start-up period).

For what it’s worth the ADM agrees, at para M7535.
https://assets.publishing.service.gov.uk/media/656083bf3d7741000d420157/admm7.pdf

Many thanks for that, folks