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Forum Home  →  Discussion  →  Universal credit administration  →  Thread

Owner occupiers and working

chris smith
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HB Help, Sussex

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Total Posts: 82

Joined: 18 June 2010

The regulations on UC payment of mortgage interest etc say that no one can get any help with these if they have any “earned income”

I had expected that there would be the same sort of bar to match that currently n place for people who are not on JSA, IS etc, but this seems to suggest that there is a bar on anyone who earns a fiver during an assessment period!

Am I right, or is “earned income” at technical term defined somewhere else?

JayKay
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Benefits adviser - Penwith Housing Association, Penzance

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Joined: 14 July 2010

The DWP keep referring to a nil earnings rule for owner occupiers - and my understanding is that any earnings at all will mean that no help towards mortgage interest will be given

But the fact that they have no housing costs included in the UC award will mean that the ‘higher work allowance’ will apply, which for claimants with children or a disability is quite a bit higher. 

JK

Gareth Morgan
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CEO, Ferret, Cardiff

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Joined: 16 June 2010

Reg. 52. “Earned income” means—
(a) the remuneration or profits derived from—
(i) employment under a contract of service or in an office, including elective office,
(ii) a trade, profession or vocation, or
(iii) any other paid work; or
(b) any income treated as earned income in accordance with this Chapter.

Sch. 5
No housing costs element where owner-occupier has any earned income
4.—(1) Section 11(1) of the Act (housing costs) does not apply to any owner-occupier in relation
to an assessment period where—
(a) the owner-occupier has any earned income; or
(b) if the owner-occupier is a member of a couple, either member of the couple has any
earned income.
(2) Sub-paragraph (1) applies irrespective of the nature of the work engaged in, its duration or
the amount of the earned income.

So 1p of earnings can lose up to £139.62 a week of mortgage interest support.  The higher earnings disregards produce a complex better off sum which depends:
- on the amount of earnings; are the net earnings high enough to use the increased disregards?
- the size of the mortgage; how much is lost
- the family type; the amount of the disregard

Our model shows very different ‘break-even points’ for different combinations.

Jon Blackwell
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Programmer - Lisson Grove Benefits Program, Brighton

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Joined: 18 June 2010

Yes, the situation for claimants with SMI now much more complicated. The break even points will be different again in shared ownership cases where losing SMI won’t get you the higher disregard.

Question: could a DM apply the test at schedule 5 para 4 [is there any earned income in this assessment period?] without *calculating* earned income?