Income and Capital and how it affects your benefits
Housing and Council Tax benefit are means tested benefits and your income and savings will effect how much benefit you may receive. If you or your partner have savings of over £16,000, you will not be eligible for either of these benefits.
Please click on a link below to go directly to the information that you require.
Capital
Income State Benefits
Income Earnings
Income Self Employment
Income Other Income
Applicable Amounts
Capital
Benefits Regulations state how we must treat any capital or savings you have. This includes land and property other than the house you occupy as well as stocks, shares, bonds, bank and building society accounts, even if they are overdrawn.
The first £6,000 of your capital is disregarded for benefit purposes (ie: not counted in the benefit calculation) but for every part or full amount of £250 you have above £6,000, we must add £1.00 to your weekly income when we calculate your benefit. This is called “Tariff Income”.
The table below shows how any capital above £6,000 (but below the £16,000 limit for Housing and Council Tax Benefit) is converted to a weekly “Tariff Income”
Tariff Income Table for Working Age claimants
| Amount of Capital | Tariff Income | Amount of capital | Tariff Income |
£6000.01 - £6250.00 | £1 | £7500.01 - £7750.00 | £7 |
£6250.01 - £6500.00 | £2 | £7750.01 - £8000.00 | £8 |
£6500.01 - £6750.00 | £3 | £8000.01 - £8250.00 | £9 |
£6750.01 - £7000.00 | £4 | £8250.01 - £8500.00 | £10 |
£7000.01 - £7250.00 | £5 | £8500.01 - £8750.00 | £11 |
£7250.01 - £7500.00 | £6 | £8750.01 - £9000.00 | £12 |
This follows the same pattern up to £16000.00.
As from 6th October 2003, if you are aged over 60, the first £6,000 of your capital is disregarded for benefit purposes and the “Tariff Income” is worked out for every part or full amount of £500 you have above £6,000.
The table below shows how any capital above £6,000 (but below the £16,000 limit for Housing and Council Tax Benefit) is converted to a weekly “Tariff Income”.
Tariff Income Table for Elderly claimants
Amount of Capital | Tariff Income | Amount of Capital | Tariff Income |
£6000.01 - £6500.00 | £1 | £9000.01 - £9500.00 | £7 |
£6500.01 - £7000.00 | £2 | £9500.01 - £10000.00 | £8 |
£7000.01 - £7500.00 | £3 | £10000.01 - £10500.00 | £9 |
£7500.01 - £8000.00 | £4 | £10500.01 - £11000.00 | £10 |
£8000.01 - £8500.00 | £5 | £11000.01 - £11500.00 | £11 |
£8500.01 - £9000.00 | £6 | £11500.01 - £12000.00 | £12 |
This follows the same pattern up to £16000.00.
We need to see proof of all capital held by either:
- Yourself.
- Your husband/wife/partner.
- Your non-dependants.
By capital we mean all your money - not just what you would call “savings”. Examples of Capital that we must be told about include:
- Cash.
- Bank current accounts, deposit accounts and savings accounts.
- National Savings accounts.
- Giro bank accounts.
- Building Society accounts.
- Stocks and Shares.
- National Savings Income Bonds.
- Land and Buildings (Not the home you are living in).
- Money borrowed.
- Premium Bonds.
Acceptable forms of evidence include:
- Bank, Building Society or Post Office books.
- Full bank statements.
- Certificates for premium bonds.
- National Savings Certificates.
- ISAs.
- Stocks and Shares.
We need to see evidence of any interest or dividends you get on investments and savings.
A SLIP FROM A CASHPOINT SHOWING THE OUTSTANDING BALANCE OF AN ACCOUNT IS NOT ACCEPTABLE AS EVIDENCE. If you cannot provide proof for any reason, you should contact the Benefits office immediately who will advise you what to do, or arrange a visit if necessary.
REMEMBER - We need to see the original documents, not photocopies. If you do not provide the documents we need, your Benefit may be delayed.
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Income
State Benefits
If you are getting Income Support or Job Seekers Allowance income-based, we may already have proof of this. If not, we are able to get proof directly from the Department for Work & Pensions.
Where you, your husband/wife/partner or your non-dependants are getting any other Social Security benefit, you will need to provide proof.
You can do this in a number of ways, but the best kinds of evidence are:
- Award notification letters that show the current rates of benefit.
- Benefit payment books (which are current and contain un-cashed orders).
If you are getting Child Benefit and cannot find you last award notification letter, but do not want to send your order book through the post, you can ask the Child Benefit Unit in Newcastle for a CH84 Form. This gives us all the information we need. You can contact the Child Benefit Unit on 08701 555540.
If the State Benefits are paid directly into a bank or building society account and the award notification letter is not available, we can also accept current bank statements or passbooks which show the payments of benefit received.
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Earnings
If you are employed we need to see evidence of your earned income and the earnings of your husband/wife/partner or any non-dependants. The evidence you provide must cover either the last:
- 5 weeks (if paid weekly).
- 6 weeks (if paid fortnightly).
- 2 months (if paid monthly).
The best kinds of evidence are either:
- Wage slips (not handwritten) or
- A certificate of earnings which has been properly completed by the employer. You can obtain one of these from the Benefits office or you can find a form enclosed with your application form.
Other forms of evidence acceptable under the Verification Framework are:
- A letter from the employer.
- A benefit award notification, which states the earnings.
The Verification Framework states that the evidence should show:
- Name and address of the employer.
- Number of hours worked.
- Period covered (e.g.: week, month etc.).
- Gross income in year to date.
- Gross income for pay period.
- Income Tax deducted.
- National Insurance contributions deducted.
- Employees pension contributions.
- Method of payment e.g.
- Cheque.
- Cash.
- Transfer to bank account etc.
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Self Employment
If you, your husband/wife/partner or your non-dependants are Self-Employed, we will need to see either:
- The most recent accounts drawn up for tax purposes, or
- An estimate of your earnings based on your income and expenditure, or
- A profit and loss summary for at least the last 6 months
If any person is involved in more than one form of self-employment, we need to see separate evidence for each type of work. You can obtain a form by contacting the Benefits Office.
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Other Income
You will need to provide proof of all other income received by yourself, your husband/wife/partner or your non-dependants. The kind of proof that you can supply will depend on what kind of income it is, as an example, the following are acceptable forms of evidence for other income:
- Working Tax Credit/Child Tax Credit - all your latest letters showing your award.
- Last payment slips (for example a Works Pension).
- Award notifications (for example Court Orders or Child Support Agency notifications).
- Court Order award notices.
- Letters from absent parents confirming maintenance payments made.
This list does not cover every type of income but whatever you provide, we need to see the original documents, not photocopies. If you are not sure about what proof to send, you should contact the Benefits Office. If you do not provide the documents we need your Benefit may be delayed.
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