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Advice State Benefits Pre-State Pension Age Benefits
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IN THIS section we examine some of the state benefits that are available before you reach State Pension age… Types Of Benefit SOME state benefits can be claimed as an individual. These are usually based on your national insurance contribution record and are referred to as contributory benefits. Your entitlement to these is not affected by your partner’s circumstances; nor is it affected by savings, capital or other income. But some other state benefits are means-tested. This means you have to claim as a couple if you live with a partner. A partner means your husband, wife, civil partner or someone you live with as part of a couple. Your savings and income are added together when calculating if you’re entitled to benefit.
Where To Apply THE Department for Work and Pensions (DWP) is the Government department with overall responsibility for benefits. Most benefits are administered by Jobcentre Plus offices, although Disability Living Allowance and Carer's Allowance are overseen by the Pensions, Disability and Carers Service. Housing Benefit and Council Tax Benefit are administered by local councils. Tax Credits are managed by Her Majesty's Revenue and Customs (HMRC). For further information call the Tax Credits Helpline on 0845 300 3900.
Jobseeker’s Allowance (JSA) YOU are able to claim Jobseeker’s Allowance if you’re out of work. Two types of JSA exist: the first is Contribution-based JSA, which is centred around your National Insurance contribution record; the second is Income-based JSA, which is means-tested. Both types of JSA are taxable. To qualify for JSA you must be:
When you sign on you’ll meet a personal adviser to discuss what you are doing to seek work. From October 2009, people who have been on JSA for at least a year will be referred to a new employment programme known as the flexible New Deal, which may include mandatory work-related activities.
Contribution-based Jobseeker’s Allowance: This is paid for a maximum of 26 weeks. The rate for people 25 or over is £64.30 a week. Normally, income and savings are not taken into account.
Income-based Jobseeker’s Allowance: This can be paid on top of Contribution-based JSA, or on its own. For Income-based JSA, you must have no more than £16,000 savings (your partner’s savings will be added to yours). If you have savings over £6,000, it will be assumed to provide you with a weekly income of £1 per week for every £250 over £6,000. Also, your partner must be unemployed or working for less than 24 hours a week. Couples might have to make a joint claim and both partners need to be actively seeking work. Income-based JSA is worked out by calculating your “applicable amount”. This includes a personal allowance, paid at the single or couple rate, plus any premiums you may be entitled to. Premiums are paid if any special circumstances apply to you or your partner, such as if you are a carer. If you’ve a mortgage, or you pay service charges for your property, your applicable amount may also include a weekly amount to cover these housing costs. If your income is less than your applicable amount, you will be entitled to benefit. If you receive Income-based JSA, you’ll automatically be entitled to the maximum Housing Benefit and Council Tax Benefit. To claim JSA, contact your local Jobcentre Plus office.
Employment and Support Allowance (ESA) THIS is the main benefit for people who cannot work due to sickness or disability. It was introduced in October 2008 and for new claimants replaced Incapacity Benefit and Income Support on the grounds of incapacity. People who are employed and have been sick for less than six months normally get Statutory Sick Pay from their employer. There are two types of ESA. Contributory ESA is paid if you have enough recent NI contributions. Income-based ESA is for those who do not have enough contributions to receive Contributory ESA, or is also for people getting Contributory ESA but whose ESA is not enough to live on.
Also, remember that ESA is taxable. To qualify for ESA, you must have a limited capacity for work; and be under State Pension age when your period of incapacity began. When you get to the State Pension age, you’ll no longer be entitled to ESA and should claim your State Pension. When you start to claim ESA, you’ll begin a 13-week assessment period when you will have to undergo a medical to find out if you should be put into the support group or the work-related activity group (for more on this see below) at the end of the assessment period. During this assessment period, you’ll receive the single rate of the basic personal allowance if you’re claiming Contributory ESA. If you are claiming Income-Based ESA, you’ll get either the single or the couple rate of ESA personal allowance as well as any premiums you might be entitled to. After the assessment phase, you’ll be put into either the support group or the work-related activity group. The most severely disabled will be put in the support group. If you are in this group you will not have to engage in work-related activities and will get a higher rate of benefit. If you are in the work-related activity group, you’ll have meetings with a personal adviser and will be offered support to consider what work you might be able to do in the future. The weekly rates of Employment and Support Allowance for people over 25 are: Basic Personal Allowance Single (Contributory and Income-based ESA): £65.45 Couple (Income-based ESA only): £102.25 Work-related activity component (paid after assessment): £25.50 Support component (paid after assessment): £30.85 Income-related ESA is calculated by working out your applicable amount. This includes the personal allowance, paid at the single or couple rate, the work-related or support component, plus other premiums you might be entitled to. If your income is less than your applicable amount, you’ll be entitled to benefit. If you get Income-based ESA, you’ll be automatically entitled to maximum Housing and Council Tax Benefit. Medical: When you initially claim ESA you will need to supply a medical certificate from a GP. There are then three medical tests for ESA:
Statutory Sick Pay (SSP): This is paid by employers at a flat rate of £79.15 a week. You might be entitled to more sick pay under the terms of your employment contract. SSP is taxable.
Incapacity Benefit: This has now been scrapped for new claimants but it can continue to be paid to people who received it before 27 October 2008 as long as they fulfil the conditions. At State Pension age, Incapacity benefit stops.
Severe Disablement Allowance (SDA): This has also been abolished for new claimants but can continue to be paid to people who were getting it before 5 April 2001. You can continue to receive this after State Pension age but get advice if you are considering this. Work and Personal Pensions: Your Contributory ESA and Incapacity Benefit may be cut if you’ve a work pension of more than £85 a week. For every £1 of pension more than £85, you will lose 50p of benefit. Disability Living Allowance YOU can claim Disability Living Allowance (DLA) if you are under 65 and you have care or mobility needs because of a disability or illness. It is not affected by savings, income or your partner’s circumstances. DLA is not means-tested and isn’t taxable. Carer’s Allowance (CA) YOU can claim this if you’re looking after someone who receives Attendance Allowance or DLA Care Component at the middle or higher rate. Carer’s Allowance might not be payable if you receive certain other benefits and sometimes the person you are caring for may lose benefits money if you claim CA. Bereavement Benefits If your wife, husband or civil partner dies you may be able to claim one of the following: Bereavement Allowance is paid to people aged 45 or over and is paid for up to 52 weeks; Widowed Parent’s Allowance for people with children is paid with no time limit. There is also a £2,000 lump sum Bereavement Payment. Entitlement to these bereavement benefits is based on the NI contribution record of the person who has died, unless they died as a result of an industrial accident or industrial disease.
Industrial Injuries Scheme YOU can claim Industrial Injuries Disablement Benefit if you’ve been injured at work. This is paid on top of other benefits such as ESA or CA, but it is classed as income when calculating means-tested benefits. You have to be assessed as at least 20% disabled to receive any payment. The weekly benefit for 100% disablement is £143.60. If you are awarded Disablement Benefit at the 100% rate, you may also qualify for extra allowances such as Constant Attendance Allowance or Exceptionally Severe Disablement Allowance. War Pensions IF you’ve been disabled through service in the armed forces, you can claim a pension or compensation payments. There are also some pensions payable to war widows/widowers. For more details contact the Veterans Agency (free) on 0800 169 2277. Working Tax Credit THIS is a cash top-up payment for people in work. It can be claimed whether you are employed or self-employed. Whether you receive WTC, and how much, depends on your circumstances and income. To qualify for WTC you must be living in the UK and working at least 16 hours a week. To qualify for the 50-plus element, you must be 50 or over and returning to work for at least 16 hours a week after coming off certain benefits. The 50-plus element is only paid for a year. WTC is not taxable and is administered by HMRC and the assessment of income and savings is done on an annual basis. For further information call the Tax Credits Helpline on 0845 300 3900. Child Tax Credit and Child Benefit IF YOU are responsible for a child under 16 or young person under 20 who’s studying for more than 12 hours a week at school or college, you can claim Child Benefit. Child Benefit is £20 per week for your oldest child and £13.20 for each other child. Your savings and income do not affect the amount you receive. You can claim Child Tax Credit (CTC) if you have a child and you’re on a low enough income. The amount of CTC you’ll receive depends on your income. You can have a family income of more than £50,000 per year and still be entitled to some CTC. Child Benefit and CTC are administered by HMRC. Call the Tax Credits helpline on 0845 300 3900 for more details.
Income Support THIS is a means-tested benefit that can be claimed by people who do not have to sign on as available for work and who are not entitled to ESA. Single parents with a child under 12, carers and people receiving IB or SDA are the most common examples of people who claim Income Support. It is calculated in a similar way to income-based JSA. Your applicable amount is compared with any income you have.
Housing Benefit/Council Tax Benefit THESE are both means-tested benefits administered by local authorities. You may be able to claim Housing Benefit (HB) if you are a tenant or if you pay rent. You might be able to claim Council Tax Benefit (CTB) to help with the cost of your Council Tax bill.
Housing Benefit (HB): You cannot receive Housing Benefit if you are a student; you live with your landlord; or you rent a house from your ex-partner. Local authorities publish the rate for rents for different size properties. If there is a shortfall between your rent and the amount of HB that you receive, you can ask the council to consider making a Discretionary Housing Payment (DHP) to make up the difference. Council Tax Benefit: You normally cannot get Council Tax Benefit if you have more than £16,000 in savings. If this is the case, you may be able to get “second adult rebate”. This may reduce your Council Tax bill if you live with someone (not your partner) who has a low income.
Social Fund THIS provides lump-sum payments to cover expenses that are difficult to meet from your weekly income. It can include help with the cost of arranging a funeral; Community Care Grants to help people live more comfortably at home; Budgeting Loans that can help with an item that you cannot afford and Crisis Loans that may be available in an emergency.
Contacts List
Benefit Enquiry Line: (free) 0800 88 22 00, www.direct.gov.uk/disability-money Carers UK: (free) 0808 808 7777, www.carersuk.org Citizens Advice Bureau: 020 7833 2181, www.adviceguide.gov.uk Direct Gov: www.direct.gov.uk/en/index.htm Disability and Carers Service: 0845 7 12 34 56, www.dwp.gov.uk/lifeevent/benefits/dcs/ Jobcentre Plus: (free) 0800 055 6688. Pension Service: 0845 6060265, www.thepensionservice.gov.uk
*Please note the details published on this page are targeted at people aged 50 or more and refers to the situation in England. **Also, please note that the information included here may change from time to time, so please take legal advice if you are in any doubt.
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