Can anyone help with this, please?
My client received a lump payment of SMP (£3,900) from her former employer. She has since given birth and would otherwise be entitled to IS as a lone parent.
Does the SMP lump payment count as income or capital? Because if it's capital, she can get IS. I asked the Benefit Delivery Centre and was told that it should be treated as capital. Given that my trust in the DWP is quite low, I thought I'd ask you expert.
Many thanks.
Bea

I suspect you may be right to doubt what the BDC said. SMP is normally paid for a period of 39 weeks begining 11 weeks before the due date of birth. It can be paid from an earlier date if the employee chooses to stop work earlier. If the amount paid is equivalent to the amount she would have received over 39 weeks then I suspect it would be treated as being taken into account as income for IS purposes for a period equal to the length of the period for which it has been paid, from the date of receipt. IS (Gen) Regs, reg 29(2)(aa)

Thanks for that. The regulations seem unequivocal on the point!