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Tue 28-Nov-06 02:09 PM by ken
Edited to fix broken link
Following the thread started on 24/10/06 in the tax credits discussion group re WTC & CA earnings limit, you may be aware that problems have arisen for some p/t workers receiving the minimum wage, and who've also been awarded CA previously.
Basically, those carers age 22+ working 16 hours had their pay increased to just over the £84 ceiling; ditto those aged 18-21 working 19 hours.
Several cases have been reported to us from Manchester. We had our first last week from Liverpool. None of these were claiming WTC although some may have been eligible. The carer from Liverpool had her CA stopped when they refused to accept her 'expenses' argument. However, we were able to advise her to get the net amount below £84pw again by the device of paying her friend a small sum who regularly pops in to see the cared-for relative while the carer is out. It will be a win:win situation because this carer is eligible for WTC as a lone parent but wasn't claiming it.
It seems that the government hasn't done joined-up thinking on this. From next April when the wage limit rises again, these carer/workers would become eligible once more (assuming they had no way of getting an allowable deduction). Then possibly not next October when the minimum wage goes up again.
I have discussed this with the good people at the Lisson Grove quick benefit prog re the 'paradox' that arises for tax deductions via PAYE. If the carer was on CA before Oct 06, their combined benefit and wages should mean that tax is being deducted, and therefore, in my view, this Liverpool carer should not have had her CA stopped. WR people may know that there is a general principle (I think) that claimants should have applied whichever rules benefit them most when there's a contradiction between two different circumstances applying (e.g. income increase v. tax owed if not already deducted; (I'm not certain this will help new CA claimants after Oct who may have been told that their wages put them above the CA limit!).
This has been brought to the attention of MP's via an early day motion, and we intend to raise it at our meeting with the Carers Allowance Unit on Friday 1/12/07. So I would like to hear from others who are aware of CA claimants affected by the slight increase in their earned income, and whether they've had to reduce their hours or even give up work etc, in order to retain their eligibility for CA.
BTW, the link to David Clelland's early day motion is:
http://edmi.parliament.uk/EDMi/EDMDetails.aspx?EDMID=31647&SESSION=885
Happy reading!
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