The Social Security Benefit (Computation of Earnings) Regulations 1996

Notional earnings E+W+S

4.—(1) Where a claimant’s earnings are not ascertainable at the date [F1 of the determination of the claim or of any subsequent review the adjudicating authority shall treat the claimant [F1 on which a decision falls to be made by the Secretary of State under Chapter II of Part I of the Social Security Act 1998 or regulations made thereunder the claimant shall be treated]] as possessing such earnings as is reasonable in the circumstances of the case having regard to the number of hours worked and the earnings paid for comparable employment in the area.

F2 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Where a claimant is treated as possessing any earnings under paragraph (1) F3 ... these Regulations shall apply for the purposes of calculating the amount of those earnings as if a payment had actually been made and as if they were actual earnings which he does possess except that paragraph (4) of regulation 10 (calculation of net earnings of employed earners) shall not apply and his net earnings shall be calculated by taking into account the earnings which he is treated as possessing, less—

(a) an amount in respect of income tax equivalent to an amount calculated by applying to those earnings the [F4 basic rate, or in the case of a Scottish taxpayer, the Scottish basic rate,] of tax in the year of assessment less only the [F5 personal reliefs to which the claimant 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 period over which those earnings are to be taken into account is less than a year, the earnings to which the [F6 basic rate, or the Scottish basic rate,] of tax is to be applied and the amount of the personal [F7 reliefs] deductible under this paragraph shall be calculated on a pro rata basis;

(b) where the weekly amount of those earnings equals or exceeds the lower earnings limit, an amount representing primary Class 1 contributions under the Contributions and Benefits Act, calculated by applying to those earnings the initial and main primary percentages in accordance with section 8(1)(a) and (b) of that Act M1 ; and

(c) one half of any sum payable by the claimant in respect of a pay period by way of a contribution towards an occupational or personal pension scheme.

Textual Amendments

F1 Words in reg. 4(1) substituted (E.W.) (29.11.1999) by The Social Security Act 1998 (Commencement No. 12 and Consequential and Transitional Provisions) Order 1999 (S.I. 1999/3178), reg. 1, Sch. 16 para. 3(a)

F2 Reg. 4(2) omitted (6.4.2016) by virtue of The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(a)

F3 Words in reg. 4(3) omitted (6.4.2016) by virtue of The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(b)

F4 Words in reg. 4(3)(a) substituted (6.4.2016) by The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(c)(i)

F5 Words in reg. 4(3)(a) substituted (6.4.2016) by The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(c)(ii)

F6 Words in reg. 4(3)(a) substituted (6.4.2016) by The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(c)(iii)

F7 Word in reg. 4(3)(a) substituted (6.4.2016) by The Social Security Benefit (Computation of Earnings) (Amendment) Regulations 2016 (S.I. 2016/267), regs. 1, 2(3)(c)(iv)

Marginal Citations

M1 Section 8(1) was amended by the Pension Schemes Act 1993 (c.48), Schedule 8, paragraph 33.