5. Earnings
Your earnings and the earnings of your partner are taken into account in the benefit assessment. It is your net weekly earnings that are taken into account – ie, after deducting:
•income tax;
•class 1 national insurance contributions;
•half of any contribution you make towards a personal or occupational pension.
Some of your earnings are disregarded. The highest disregard that applies in your circumstances is deducted:
•£25 for lone parents claiming housing benefit (HB) who are not claiming income support (IS), income-based jobseeker’s allowance (JSA) or income-related employment and support allowance (ESA);
•£20 for lone parents claiming IS, JSA or ESA;
•£20 for someone who gets a disability premium;
•£20 for someone who gets a carer premium;
•£20 for part-time firefighters and some other emergency auxiliaries;
•£10 for couples, whether one or both of you are working;
•£5 for single people.
For HB only, there is an additional disregard (£17.10) for some people working 16/30 hours a week.
For HB, childcare costs for registered childminders, nurseries and playschemes can be disregarded from earnings in some circumstances. Childcare costs of up to £175 a week for one child or £300 for two or more children are deducted from weekly earnings for:
•lone parents who are working;
•couples who are both working;
•couples, where one is working and one is incapacitated or in hospital or prison.
In each case, the work must be for 16 hours or more a week.
For full details of the way earnings are treated, see CPAG’s Welfare Benefits and Tax Credits Handbook.