PART 6Income and capital
SECTION 5Other income
Notional income42
1
A claimant shall be treated as possessing income of which he has deprived himself for the purpose of securing entitlement to housing benefit or increasing the amount of that benefit.
2
Except in the case of—
a
a discretionary trust;
b
a trust derived from a payment made in consequence of a personal injury;
c
F36d
any sum to which paragraph 45(2)(a) of Schedule 6 (capital to be disregarded) applies which is administered in the way referred to in paragraph 45(1)(a);
F36da
any sum to which paragraph 46(a) of Schedule 6 refers;
e
rehabilitation allowance made under section 2 of the 1973 Act;
f
child tax credit; or
g
working tax credit,
F4h
any sum to which paragraph (12A) applies;
any income which would become available to the claimant upon application being made, but which has not been acquired by him, shall be treated as possessed by the claimant but only from the date on which it could be expected to be acquired were an application made.
F383
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F383A
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F384
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F385
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6
Any payment of income, other than a payment of income specified in F18paragraph (7) or (7A), made—
a
to a third party in respect of a single claimant or a member of the family (but not a member of the third party's family) shall, where that payment is a payment of an occupational pension F30, a pension or other periodical payment made under a personal pension scheme or a payment made by the Board of the Pension Protection Fund, be treated as possessed by that single claimant or, as the case may be, by that member;
b
to a third party in respect of a single claimant or in respect of a member of the family (but not a member of the third party's family) shall, where it is not a payment referred to in sub-paragraph (a), be treated as possessed by that single claimant or by that member to the extent that it is used for the food, household fuel or, subject to paragraph (13), rent or ordinary clothing or footwear, of that single claimant or, as the case may be, of any member of that family or is used for any council tax or water charges for which that claimant or member is liable;
c
to a single claimant or a member of the family in respect of a third party (but not in respect of another member of that family) shall be treated as possessed by that single claimant or, as the case may be, that member of the family to the extent that it is kept or used by him or used by or on behalf of any member of the family.
C17
Paragraph (6) shall not apply in respect of a payment of income made—
a
under F9or by the Macfarlane Trust, the Macfarlane (Special Payments) Trust, the Macfarlane (Special Payments) (No. 2) Trust, the Fund, the Eileen Trust F25, MFET LimitedF12, the Skipton Fund, the Caxton FoundationF7, the Scottish Infected Blood Support SchemeF35, an approved blood schemeF26, the London Emergencies Trust, the We Love Manchester Emergency FundF22, the National Emergencies Trust or the Independent Living F5Fund (2006);
b
pursuant to section 19(1)(a) of the Coal Industry Act 1994 M1 (concessionary coal);
c
pursuant to section 2 of the 1973 Act in respect of a person's participation—
i
in an employment programme specified in regulation 75(1)(a)(ii) of the Jobseeker's Allowance Regulations;
ii
in a training scheme specified in regulation 75(1)(b)(ii) of those Regulations;
iii
iv
in a qualifying course within the meaning specified in regulation 17A(7) of those Regulations F13; or
v
in the Flexible New Deal specified in regulation 75(1)(a)(v) of those Regulations;
F16cb
in respect of a person's participation in the Mandatory Work Activity Scheme;
F3cc
in respect of a claimant's participation in a scheme prescribed in regulation 3 of the Jobseeker's Allowance (Schemes for Assisting Persons to Obtain Employment) Regulations 2013;
F27cd
in respect of a person’s participation in a scheme prescribed in regulation 3 of the Jobseeker’s Allowance (Supervised Jobsearch Pilot Scheme) Regulations 2014;
F8ce
in respect of a person’s participation in a scheme prescribed in regulation 3 of the Jobseekers Allowance (18 - 21 Work Skills Pilot Scheme) Regulations 2014;
d
under an occupational pension scheme F17, in respect of a pension or other periodical payment made under a personal pension scheme or a payment made by the Board of the Pension Protection Fund where—
i
a bankruptcy order has been made in respect of the person in respect of whom the payment has been made or, in Scotland, the estate of that person is subject to sequestration or a judicial factor has been appointed on that person's estate under section 41 of the Solicitors (Scotland) Act 1980M2;
ii
the payment is made to the trustee in bankruptcy or any other person acting on behalf of the creditors; and
iii
the person referred to in (i) and any member of his family does not possess, or is not treated as possessing, any other income apart from that payment.
F17A
Paragraph (6) shall not apply in respect of a payment of income which is a Grenfell Tower payment.
8
Where a claimant is in receipt of any benefit (other than housing benefit) under the benefit Acts and the rate of that benefit is altered with effect from a date on or after 1st April in any year but not more than 14 days thereafter, the relevant authority shall treat the claimant as possessing such benefit at the altered rate—
a
in a case in which the claimant's weekly amount of eligible rent falls to be calculated in accordance with regulation 80(2)(b) F33or (c) (calculation of weekly amounts), from 1st April in that year;
b
in any other case, from the first Monday in April in that year,
to the date on which the altered rate is to take effect.
9
Subject to paragraph (10), where—
a
a claimant performs a service for another person; and
b
that person makes no payment of earnings or pays less than that paid for a comparable employment in the area,
the relevant authority shall treat the claimant as possessing such earnings (if any) as is reasonable for that employment unless the claimant satisfies the authority that the means of that person are insufficient for him to pay or to pay more for the service.
10
Paragraph (9) shall not apply—
a
to a claimant who is engaged by a charitable or voluntary organisation or who is a volunteer if the relevant authority is satisfied in any of those cases that it is reasonable for him to provide those services free of charge; or
b
in a case where the service is performed in connection with—
i
the claimant's participation in an employment or training programme in accordance with regulation 19(1)(q) of the Jobseeker's Allowance Regulations, other than where the service is performed in connection with the claimant's participation in the Intense Activity Period specified in regulation 75(1)(a)(iv) of those RegulationsF19...; or
ii
the claimant's or the claimant's partner's participation in an employment or training programme as defined in regulation 19(3) of those Regulations for which a training allowance is not payable or, where such an allowance is payable, it is payable for the sole purpose of reimbursement of travelling or meal expenses to the person participating in that programme F10; or
c
to a claimant who is participating in a work placement approved by the Secretary of State (or a person providing services to the Secretary of State) before the placement starts.
10A
In paragraph (10)(c) “work placement” means practical work experience which is not undertaken in expectation of payment.
11
Where a claimant is treated as possessing any income under any of paragraphs (1) to (8), the foregoing provisions of this Part shall apply for the purposes of calculating the amount of that income as if a payment had actually been made and as if it were actual income which he does possess.
12
Where a claimant is treated as possessing any earnings under paragraph (9) the foregoing provisions of this Part 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 (3) of regulation 36 (calculation of net earnings of employed earners) shall not apply and his net earnings shall be calculated by taking into account those 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 F29... and the basic rate F15, or in the case of a Scottish taxpayer, the Scottish basic rate, of tax applicable to the assessment period less only the F14personal 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 assessment period is less than a year, the earnings to which the F23basicF24rate F31, or the Scottish basic rate, of tax is to be applied and the amount of the personal F11reliefs deductible under this sub-paragraph shall 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 Act in respect of those earnings if such contributions were payable; and
c
one-half of any sum payable by the claimant by way of a contribution towards an occupational or personal pension scheme.
F212A
Paragraphs (1), (2), (6) and (9) shall not apply in respect of any amount of income other than earnings, or earnings of an employed earner, arising out of the F32claimant participating as a service user.
13
In paragraph (6) “rent” means eligible rent less any deductions in respect of non-dependants which fall to be made under regulation 74 (non-dependant deductions).