3 State benefits Flashcards by Peter Ffoulkes

What is the difference between a non contributory and a contributory state benefit?

contributory takes in to account NIC payments, non-contributory is a means tested benefit for those on lower incomes etc.

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What was the effect of the welfare Reform Act 2012 on state beenfits?

transitioned lots of benefits in to a single universal credit

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Why do advisers still need to be aware of previous benefits before they were rolled in to universal credit/

People are still in receipt of them, so need to understand them

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Which act replaced the old system of bereavement payment with the new one?

Pensions Act 2014

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What is the purpose of the bereavement support payemnt?

Meant to help towards costs of losing a partner

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Pre Pension Act 2014, what were the 3 different types of bereavement payments available?

bereavement payment
Widowed parents allowance
Bereavement allowance

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Does the bereavement support payment cover cohabiting partners?

Yes

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How is the bereavement support payment paid?

as an initial lump sum up to 3.5k, then monthly instalments for 18 months afterwards

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How do the rates of bereavement support payment change for those with children and without them?

2.5k for those w out children w £100pm instalments,
with children is £3.5k w £350pm

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When can bereavement support payment claims be reduced?

Claims may be reduced if the partner died after 9 February 2023 and the claim is made more
than three months after the partner’s death.

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What is the tax treatment of the bereavement support payment and how does it affect the benefit cap/

Tax free and not included in assessment of benefit income for benefit cap

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For the previous bereavement allowance, how much was the bereavement payment?

£2k

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How often was the widowed parents allowance paid and when would someone qualify for it?

Weekly payment - qualified if deceased spouse had satisfactory NIC record

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Is the bereavement allowance taxable and for how long are they paid?

Yes and for 52 weeks

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How old does someone have to be to qualify for bereavement allowance

betweeen 45 & state pension age

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What are the 4 types of income related benefits available?

Income support
Jobseekers Allowance
Statutory Sick Pay
Employment & Support Allowance

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up to what level of capital are income benefits not usually available to people?

£16k

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if someone has over £6k in savings, how much are income related benefits reduced by?

£1 a week for every £250 over £6k

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Is income support a means tested benefit?

Yes

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What age group is income support available for?

16- state pension age

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List 3 other criteria for receiving Income support

Not a full time student
Low income and no more than £16k savings
Working less than 16 hrs a week
Not in receipt of JSA or ESA
Usually available for those who meet the criteria and have a child under 5 or caring responsibilities,

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Income support is not generally taxable, but when could it be taxable?

When a claimant is on strike
Or - involved in a trade dispute and is one of a couple & receiving a benefit for their partner

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Now that income support is no longer available to new claimants, what must people claim instead?

Universal credit

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Who is Jobseekers Allowance suitable for?

For those out of work and looking for work

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What is the criteria to be eligible for JSA?

Need to be between 18 - SPA Need to be fit & available for work, also actively looking for it

What are the two types of JSA?

New style JSA Income based JSa

Are the two types of JSA taxable?

Yes

is the new style JSA a means testes or contributions based benefit?

Contributions based

What is the maximum time the new style JSA can be claimed for and how much can people under & over 25 receive?

6 months under 25 - £71 pw Over 25 - £91 pw

what does the amount of the income based JSA depend on?

Claimants income & savings as well as partners

At what point does JSA become means tested?

6 months

When would someone be eligible for staturtory sick pay?

When off work for 4+ days in a row

Is SSP taxable and who pays for it?

Yes, taxable as earned income and need to pay NICs on payments - employer pays

What is the rate of SSP a claimant can claim and for how long can they claim for?

£116 pw and payable for up to 6 months

Is SSP means tested or contributoions based?

Means tested

Who is the employment and support allowance designed for?

For people of work, designed to help them get back in to work

Historically what were the 2 main types of ways ESA was paid?

Contributions based Means tested

What is the new style ESA?

Contibutions based, means tested & taxable

when do people enter the assessment phase of the ESA?

After 6 months

What are the 2 groups in the main phase?

a) Support group - can't work b) Work related activity group - can do some kind of work

How much will claimants receive in the 2 groups in the main phase?

 Support group – Can’t work, £138.20 pw andcan receive new style ESA indefinitely  Work related activity group – Can do some kind of work, £90.50 pw – need to attend mandatory interviews starting from week 8 of their claim

What is the personal independence payment (PIP)?

Payment which helps towards people who need help with daily living/ mobility

Which act brought in the personal independence payment (PIP)?

Welfare Reform Act 2012

What benefit did the personal independence payment (PIP) replace?

The Disability Living Allowance

how old do you have to be to claim the personal independence payment (PIP)?

16 - State pension age

What is the criteria to qualify for the personal independence payment (PIP)?

Need to have issues with daily living or mobility which have lasted for 3 months and expected to continue for at least 9 months – or have only 6 months to live

What are the 2 different componenets of the PIP and what are the different payment rates?

Daily living – if can’t wash, prepare/eat food, communicate – can get enhanced rate of £108 pw or standard rate £72 Mobility component – If need help leaving the house/ moving around – enhanaced rate £75 pw, standard £28 pw

Who is the Disability Living Allowance designed for?

For those under SPA who need care, moving around or both

What is the tax treatment of the DLA and is it means tested?

Tax free and not means tested

What are the 2 components of the DLA?

Care and mobility componennts

How can someone qualify for the DLA?

Need to satisfy criteria for 3 months, then expected to do so for a further 6 months

What is the attendance allowance?

Benefit for those who have been suffering from disability for 6 months +

At what age can people start to receive the attendance allowance?

Over SPA

What is the difference between the higher & lower rate of attendance allowance?

a higher rate of £108.55 (2024/25) if care is needed on a 24-hour basis; * a lower rate of £72.65 (2024/25) if care is needed by night or by day, but not both.

Is the attendance allowance subject to tax & is it means tested/ contributions based?

Attendance allowance isn’t taxed, also isn’t means tested or contributions based

What is the carer's allowance and how does someone qualify for it?

Benefit for carer’s over working age who care for someone in receipt of a Disability benefit

How can someone qualify for the carer's allowance and how much is the payment pw?

Carer can’t earn more than £151 pw or be in full time education – benefit is £81.90 pw

Who is the child benefit for?

For parents who have a child under 16, or one in full time education under 20

What is the tax treatment of child benefit & is it contributions based/ means tested?

Tax free & non means & contributions based

How much is the child benefit for the first child & subsequent child?

£25pw first child, £16.96 subsequent child

When does the high income child benefit charge apply?

When one parent earns over £60k

How much is the high income child benefit charge?

1% of the amount of child benefit for every £200 over £60k

Who are child and working tax credits currenly payable by?

HMRC

Who can claim child tax credits?

If parents have a child under 16 or between 16-19 living with them they can claim family element of CTC

How much is the familt element of CTC?

£545

When is the child tax credit usually reduced?

Reduced by 41p for every £1 of income over £19,995

What is the working tax credit?

payment to top up earnings of those on low incomes, including those without kids

What does the amount of the working tax credit depend on?

amount varies depending on how often you work, if you’re disabled and if you have kids

What are the 2 main types of benefits to help with housign costs?

Housing benefit Support with mortgage interest

What is the housing benefit and who is it for?

For renters, designed to help them with their rent

Who can make a new hosuing benefit claim?

For those of state pension age or in supported housing

What does the amount of the housing benefit depend on?

Age, location, amount of rent

what types of properties can housing benefit be claimed for?

All types - private or council

How does the DWP provide support for mortgage interest & how is it repaid?

By a loan, it's paid off with interest when the house is sold

How much mortgage interest can DWP help to pay off with an SMI benefit?

pay the interest on up to £200k of mortgage borrowing at standardised rate

Name 3 benefits which Universal credit has integrated

* Income Support; * income-based JSA; * income-related ESA; * Housing Benefit; * Child Tax Credit; and * Working Tax Credit

What is the tax treatment or universal credit, is it tax free and how often is it paid ?

It is means-tested, tax free and paid monthly into a bank or building society account.

What is the standard allowance for universal credit?

£393 for single adult over 25

Can people still claim for universal credit on low income jobs?

Yes

What is a claimant commitment and why do out of work universl credit claimants have to agree to one?

Sets out what they have agreed to do to prepare and look for work

What is the benefit cap?

A cap on the of amount benefits one houself can claim

Name 3 benefits which are collected under the benefits cap

JSA, child benefit & bereavement allowance

Name 3 benefits which aren't collected under the benefits cap

Attendance allowance, carer’s allowance, disability living allowance

Generally, who is entitled to more under the benefit cap?

For those who live in central london & have kids

what pensions did the new state pension replace in April 2016?

The basic and additional state pension

What were the two previous legacy schemes under the old state pension?

SERPS (state earnings related pension scheme) & S2P (state second pension)

What are the 2 types of pension credit pensioners can receive?

o Guarantee credit – Provides min level of income for those over certain age, can have more if disabled/ has caring responsibilities o Savings credit – For those who turned 65 pre April 2016