Ok - so this is a long shot!!

Am attempting to complete an `offset` calculation for claimant has an overpayment of £70,000 going back to 1992.

Want to try and establish whether he would have had an entitlement to Family Credit at this time - I have the actual Family Credit rates but dont know how the calculation was made - ie how did the rates relate to actual income that the client had at the time.

Can anybody help me!!

Cath

This is from the dark, deep recesses of my memory so someone may need to correct me. The FC calculation was a weekly one and income from earnings was net income not gross (I think). The calculation is more or less the same as for tax credits but the taper figure was 55% as opposed to the current 37%. Does that help at all?

Regards
Paul

Thats brilliant - thanks a lot for your help

Ah yes- I remember it well.... (or, at least, not so well that I didn't have to look it up again in the CPAG 1992/3 handbook). Basic calculation follows:

1) Work out maximum weekly credit
Rates: £41 adult credit (same for couple or lone parent)
£10.40 child 0-10
£17.25 child 11-15
£21.45 child 16-17
£29.90 child 18

2) Work out weekly income/capital
Capital limit £8000 (tarrif income on capital £3000+)
Net earnings
Benefits (disgregarded benefits- DLA, Child ben, SMP)
Maintenance (counts in full)

3) If income the same, or less than, maximum credit, full credit
payable. If income more than maximum credit, calculate 37% of
difference and deduct from maximum credit to get weekly award.

FC was payable for 26 weeks regardless of most changes in circumstances (main exceptions were child leaving the household or death of claimant).

Oh, life was simpler then...I am old and grey, etc, etc

Hope that helps!

3)

Although not much use without the calculation formula helpfully provided by provided by nevip and 1964, the Institute for Fiscal Studies website carries a full listing of all benefit rates from 1939 to the present day.

There is a link to IFS website from rightsnet's benefit rates area -

http://www.rightsnet.org.uk/cgi-bin/publisher/display.cgi?1445-9103-19416+swopshop

but here is a link to their page relating to family credit -

http://www.ifs.org.uk/ff/wftc.xls

nevip and 1964 offer different rates for the taper - my recollection is that the calculation of net income was as described by 1964 but the taper was 55% as nevip says.

In fact, 37% of gross income as currently used is more or less the same as 55% of net as used then, I think (give or take odd differences in disregarded items).

Anyone want to ask any questions about FIS, so us old and grey uns can get another nostalgia fix?

Now that's interesting. 55% of net corresponds to 37% of gross!

Sure is:

Excess income = £10. Take off £2.20 Tax and £1.10 NI leaves £6.70. 55% of £6.70 is £3.68.

37% of £10 is £3.70.

They gave nowt away when they reduced the taper rate for new tax credits did they?

Sorry - should have also added that the comparison before calculating the taper was with an applicable amount, not with maximum credit. The applicable amount was always the same regardless of family size (just like the current tax credits we know and love) and in 1992 this was £66.60 a week.

I have to say I am very impressed by the length of your memories!!! (coming from a person who cant remember what she had for tea last night let alone benefit payments from over 10 years ago!)

Thanks a lot for all your help - have now managed to complete the offset calculation.

The possessor of a better (if not necessarily longer) memory than any of ours has pointed out to me that the taper for FC was not 37% - it was not even 55% - it was 70%. It didn't reduce to 55% till the advent of Working Families Tax Credit in 1999.

Hope redoing the calculations isn't too onerous.

Sorry. Perhaps I'll read David Blunkett's autobiography as a penance.

So it was! Memory , shot to pieces I'm afraid!

Yep- you're quite right, it was. Don't know where I got 37% from. Must be the effect of being old & grey...