The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012

Calculation of net earnings of employed earners E+W

19.—(1) For the purposes of paragraph 24 (calculation of income on a weekly basis), the earnings of an applicant derived or likely to be derived from employment as an employed earner to be taken into account must, subject to paragraph 17(5) and Schedule 4 (sums disregarded from earnings), be his net earnings.

(2) For the purposes of sub-paragraph (1) net earnings must, except where sub-paragraph (5) applies, be calculated by taking into account the gross earnings of the applicant from that employment over the assessment period, less—

(a) any amount deducted from those earnings by way of—

(i) income tax;

(ii) primary Class 1 contributions under the SSCBA;

(b) one-half of any sum paid by the applicant by way of a contribution towards an occupational pension scheme;

(c) one-half of the amount calculated in accordance with sub-paragraph (4) in respect of any qualifying contribution payable by the applicant; and

(d) where those earnings include a payment which is payable under any enactment having effect in Northern Ireland and which corresponds to statutory sick pay, statutory maternity pay, [F1 statutory paternity pay, statutory shared parental pay] or statutory adoption pay, any amount deducted from those earnings by way of any contributions which are payable under any enactment having effect in Northern Ireland and which correspond to primary Class 1 contributions under the SSCBA.

(3) In this regulation “qualifying contribution” means any sum which is payable periodically as a contribution towards a personal pension scheme.

(4) The amount in respect of any qualifying contribution is to be calculated by multiplying the daily amount of the qualifying contribution by the number equal to the number of days in the assessment period; and for the purposes of this paragraph the daily amount of the qualifying contribution is to be determined—

(a) where the qualifying contribution is payable monthly, by multiplying the amount of the qualifying contribution by 12 and dividing the product by 365;

(b) in any other case, by dividing the amount of the qualifying contribution by the number equal to the number of days in the period to which the qualifying contribution relates.

(5) Where the earnings of an applicant are determined under paragraph 17(2)(b) (calculation of weekly income) his net earnings are to be calculated by taking into account those earnings over the assessment period, less—

(a) an amount in respect of income tax equivalent to an amount calculated by applying to those earnings the basic rate [F2 , or in the case of a Scottish taxpayer, the Scottish basic rate,] of tax applicable to the assessment period less only the [F3 personal reliefs to which the applicant is entitled under Chapters 2, 3 and 3A of Part 3 of the Income Tax Act 2007 as are] appropriate to his circumstances but, if the assessment period is less than a year, the earnings to which the basic rate [F4 , or the Scottish basic rate,] of tax is to be applied and the amount of the personal [F5 reliefs] deductible under this sub-paragraph is to be calculated on a pro rata basis;

(b) an amount equivalent to the amount of the primary Class 1 contributions that would be payable by him under the SSCBA in respect of those earnings if such contributions were payable; and

(c) one-half of any sum which would be payable by the applicant by way of a contribution towards an occupational or personal pension scheme, if the earnings so estimated were actual earnings.

Textual Amendments

F1 Words in Sch. 1 para. 19(2)(d) substituted (31.12.2014) by The Shared Parental Leave and Statutory Shared Parental Pay (Consequential Amendments to Subordinate Legislation) Order 2014 (S.I. 2014/3255), arts. 1(2), 27(4)(c)

F2 Words in Sch. 1 para. 19(5)(a) inserted (with application in accordance with reg. 1(2) of the amending S.I.) by The Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations 2016 (S.I. 2016/1262), regs. 1(1), 2(3)(c)(i) (with reg. 3)

F3 Words in Sch. 1 para. 19(5)(a) substituted (with application in accordance with reg. 1(2) of the amending S.I.) by The Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations 2016 (S.I. 2016/1262), regs. 1(1), 2(3)(c)(ii) (with reg. 3)

F4 Words in Sch. 1 para. 19(5)(a) inserted (with application in accordance with reg. 1(2) of the amending S.I.) by The Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations 2016 (S.I. 2016/1262), regs. 1(1), 2(3)(c)(iii) (with reg. 3)

F5 Word in Sch. 1 para. 19(5)(a) substituted (with application in accordance with reg. 1(2) of the amending S.I.) by The Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations 2016 (S.I. 2016/1262), regs. 1(1), 2(3)(c)(iv) (with reg. 3)

Commencement Information

I1 Sch. 1 para. 19 in force at 27.11.2012, see reg. 1(1)