Universal Credit: Income Tax

Department for Work and Pensions written question – answered on 25th January 2018.

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Photo of Alex Sobel Alex Sobel Labour/Co-operative, Leeds North West

To ask the Secretary of State for Work and Pensions, for what reasons a claimant's weekly income tax rebate is regarded as earnings under universal credit.

Photo of Alok Sharma Alok Sharma The Minister of State, Department for Work and Pensions

Repayments of Income Tax and National Insurance contribution repayments add to people’s financial resources, so they need to be taken into account in calculating their Universal Credit. If the claimant was in any paid work during the tax year the repayment relates to, these repayments will be treated as earnings. Where this does not apply, the repayments will be treated as capital. If the repayment increases a claimant’s capital to £6,000 or more, it may affect the amount of Universal Credit they receive.

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