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Pension Credit, fluctating self-employment earnings and any time revision?

 

EKS_COTTON
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Tax and Welfare Rights Officer, Equity

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Hi guys,

I have question about a pension credit claimant with fluctuating self-employment earnings. 

Her self-employment earnings have been over estimated by DWP based on the income she has received so far this tax year 2018-19 (they have based it on the previous year 2017-18).

However she still gets a small award, passporting her to Housing and council tax benefit.

She is tempted to leave it just in case she ends up earning more by the end of this tax year.

She asked me whether, it was possible to be backpaid Pension Credit at the end of the year having submitted her actual figures, presuming they were lower - e.g. basically saying you assessed me as earning X in self-employment in 2018-19 but in fact I have earned Y.

I wondered whether the any time revision provision would allow for this?

Any thoughts?

In solidarity

EKS

     
past caring
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Welfare Rights Adviser Southwark Law Centre Peckham

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Basically, no.

Any time revision under reg. 3 (5) of the Decisions and Appeals Regs is essentially limited to cases of official error and cases where there has been a mistake or ignorance of a material fact - but in the latter category of case, only where the decision to be revised is one which was more advantageous to the claimant than it would have been had there not been the mistake/ignorance. And you aren’t going to get official error off the ground when the ‘error’ is solely attributable to the claimant not disclosing circumstances that would have led to an increased award had they been disclosed at the time.

For similar reasons, you would not be able to meet the conditions set out for a late (i.e. within 13 months) revision under reg. 4 when there was nothing but the claimant’s choice that prevented an in-time revision being requested.

In any event, given that the decision your client would be seeking to get changed would, almost certainly, have been correct at the time that it was made (i.e. it would have been correct for Pensions Service to use the previous year’s tax return figures - see reg. 17B State Pension Credit Regs - and apparent even to the claimant only later that this year’s earnings were likely to be lower) the correct approach would seem to be a request for supersession for change of circumstances under reg. 6 (2)(a) of the D&A Regs. If need be, citing reg. 11(1) Social Security Benefit (Computation of Earnings) as authority for an assessment of self-employed earnings over a more appropriate period than a previous year due to a change to the claimant’s business.

EKS_COTTON - 24 July 2018 03:31 PM

She asked me whether, it was possible to be backpaid Pension Credit at the end of the year having submitted her actual figures, presuming they were lower - e.g. basically saying you assessed me as earning X in self-employment in 2018-19 but in fact I have earned Y.

That wouldn’t work for the reasons outlined. It would, however, then result in an increased award for the 2019 - 2020 year. The problem with that is that if her earnings in the 2019 - 2020 then returned to ‘normal’ levels she would need to disclose the fact immediately or an overpayment would result.

I don’t see what the problem is with simply applying for a supersession now? We are sufficiently far into the financial year for it to have become clear to her that there has been a significant drop in her earnings from last year - if it is that clear, there should be no great difficulty in arguing that reg. 11(1) of the Computation of Earnings Regs is the appropriate way to assess her income from earnings…....

     
EKS_COTTON
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Tax and Welfare Rights Officer, Equity

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Total Posts: 141

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Thanks so much for the detailed and speedy reply - really helpful.

There is no problem per se in applying for a supersession now, it is just in her case, she thinks it is possible that she might earn the remainder of the difference between her state pension and pension credit figure by the end of the tax year, taking into account earnings already received so far. But cannot be entirely sure - such is the nature of the work she does.

I think the most practical solution might be to continue with previous years assessments being used (although for most of my other self-employed claimants I am constantly arguing another period is appropriate) but to be mindful of the limit and as you say disclose immediately if earning change.

I will put all the information to her.  Many thanks again.