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Confused - Child Element
The current benefit cap for a single parent is £500-00 per week and therefore equates to £2166-67 per month (take home). The child element of U/C for the first or only child is £277-08 a month. Therefore if a single parent with one child is in full time employment and takes home £1889-59 per month, am I right in thinking that the same parent would then be eligible for the single child element of U/C to the sum of £277-08, this equating to the figure had the single parent been claiming U/C and not working. I’m sure it’s more complicated than this so any views/answers and examples would be appreciated.
Her UC maximum award would be 317.82 for her and 277.08 for her child plus any housing costs if she rents.
He income would be 1889.59 less the work allowance (734 or 263 depending if she had a mortgage or rented) and then take 65% of that. Provided she has no other income (apart from child benefit or maintenance which are disregarded in full) that will be the income figure.
UC entitlement is the maximum award less the income figure.
The cap only comes into place if the UC entitlement is more than the cap but working people are exempt from cap anyway.
working people are exempt from cap anyway.
If they earn over a, low, threshold.
Yes that’s true but this woman is well over the threshold.
FAO Daphne - so client takes home £1889-59. She pays her mortgage so take £263-00 away from the
£1889-59 = £1625-59.
65% of £1625-59 equates to £1057-28, so is this what she would get in UC instead of working tax credit.
Again, if working tax credit is being taken over by UC, then are people who work full time and receive WTC going to lose it or again will they receive the lower/upper work allowance pound for pound to make up for the loss of WTC.
FAO Daphne - so client takes home £1889-59. She pays her mortgage so take £263-00 away from the
£1889-59 = £1625-59.65% of £1625-59 equates to £1057-28, so is this what she would get in UC instead of working tax credit.
If she works then she gets no owner-occupier housing costs and if she has no housing element then she gets the higher work allowance - so £734* instead of £263* - as Daphne says.
Either way, with just the standard and chlild elements there would be no UC
Net earnings: 1889.59 - less work allowance £734.00 = £1115.59
Excess earnings £1119.59 x 65% = £751.13
Maximum UC = £317.82(Standard)+£277.08*(Child)=594.90
UC is £594.90 less £751.13 = Nil
(* The work allowances will be reduced from April 16 and the first child element will be reduced from April 17. )
[ Edited: 15 Nov 2015 at 03:28 pm by Jon Blackwell ]
Again, if working tax credit is being taken over by UC, then are people who work full time and receive WTC going to lose it or again will they receive the lower/upper work allowance pound for pound to make up for the loss of WTC.
When/if existing legacy benefit claimants are eventually moved on to UC (‘managed migration’) it’s expected that UC will be topped up so there’s no cash loss at the point of transfer ( this won’t apply where people move on to UC due to a change of circumstances.)
Currently there are no regulations to cover this but I think that they’ll do it by including a transitional element in the maximum amount ( rather than by adjusting work allowances which won’t exist for many UC claimants.)