Does anyone know if the New Deal 25+ payments are counted as income for Tax Credit purposes. I have spoke to someone on the Tax Credit Advisors Help Line who informed me that he had never heard of the New Deal 25+, only the New Deal 50+, therefore the New Deal 25+ should be counted as income. Can anyone help clear this up?

The short answer is 'I don't know'. But try asking the DWP if the payments are taxable. They should know as they send P60's to claimants in receipt of taxable benefits... If not taxable, then almost certainly doesn't count as income for tax credits. You could also try asking CPAG using the advisers line as they have lots of knowledge about tax credits (and they have tax law reference books).

Is this your answer?

TCTM04913A - Sums disregarded in the calculation of income

Mandatory top-up under Voluntary Sector and Environmental Task Force Options of New Deal and under New Deal 25+
The Tax Credits (Definition and Calculation of Income) Regulations 2002,Reg.19, Table 6, Item 3.

A mandatory top-up payment may be disregarded if its is made:

under section 2 of the Employment and Training Act 1973, or section 1 of the Employment and Training Act (Northern Ireland) 1950 in respect of a claimant’s participation in:
an employment programme in the Voluntary Sector, or
an employment programme such as the Environmental Task Force Options of the New Deal, or
the Intensive Activity Period of the New Deal 25 plus (or, in Northern Ireland, the Preparation for Employment Programme).
A payment may also be disregarded if it is paid under a written agreement between the Secretary of State (or, in Northern Ireland, the Department of Employment & Learning) and the person who has arranged their participation in the Intensive Activity Period of New Deal 25 plus (or, in Northern Ireland, the Preparation for Employment Programme).

Such payments are disregarded only to the extent that they are not taxable as a profit of a trade, profession or vocation.


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