Can anyone offer some help.

My client is a single mother with 2 children. She stopped work in January because of ill health and advised TO to stop WTC and took her children out of childcare.

TO did not stop her WTC until some months later and she was unable to claim IS until July because of various problems with her employer (lack of P45 and some holiday pay they made to her in June).

HB accordingly assessed her claim up to July on her income of CTC, CHB and WTC but applied no childcare disregards because she was not working.

WTC should not have been paid and they are aware of this although have not raised an overpayment yet.

Although she had enough income she wasnt paying her full rent during this time because she had large arrears with childcare provider and now has significant rent arrears and a suspended posession hearing.

As I understand it, HB was assessed correctly because they could not include any disregards, is this correct?

My main reason for exploring this is the recent caselaw which determined that incorrect payments of WTC could not be used in the calculation of IS and clutching at straws I wondered if this could apply to HB?

Any thoughts would be greatly appreciated.

If you are talking about CIS/1813/2007 then there is no reason why the same principle should not apply. Once payments are not classed as income they are not taken into account unless there is some other deeming provision which treats them as income. As far as I am aware there is no such other deeming provision that would apply here.

Tue 23-Sep-08 05:34 PM by Kevin D

The IS CD in question is CIS/1813/2007. Also see CH/1450/2005 where the Cmmr found that TC must be taken into account.

There is no reason, so far as I can see, to prevent the principle from the IS CD being applied when assessing HB/CTB. As to which CD applies will simply depend on the facts of the case.

EDit: Hadn't seen nevip's post when compiling this

Is there really an overpayment of WTC anyway?

WTC can continue for 28 weeks if a claimant is sick as they can be treated as still being in remunerative work for this period.

I'm getting a bit muddled. The Tax Office are treating her end date of work as 21/05/08 as this is what is on her P45 even though she stopped in Jan. No SSP was paid during that time only holiday pay in May. As such they have not got a overpayment for the period between Jan and May. Would this affect my use of the caselaw as the TO are not saying it was paid incorrectly?

Many thanks for any help, Tax credits do confuse me!

If Tax Credits are paid correctly, CH/1450/2005 applies and the LA is correct to take the payments into account.