Regulation 26 Notional incomeI1
England, Wales and Scotland
A claimant shall be treated as possessing income of which he has deprived himself for the purpose of securing entitlement to council tax benefit or increasing the amount of that benefit.
Except in the case of a discretionary trust or a trust derived from a payment made in consequence of a personal injury, 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.
Any payment of income, other than a payment of income made under the Trusts, the Fund F1, the Eileen Trust or F2the Independent Living Funds, made—
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 be treated as possessed by that single claimant or by that member to the extent that it is used for the food, ordinary clothing or footwear, household fuel, or F3rent 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;
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.
Where a claimant is in receipt of any benefit (other than council tax benefit) under the Contributions and Benefits Act 1992 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 appropriate authority shall treat the claimant as possessing such benefit at the altered rate from either 1st April or the first Monday in April in that year whichever date the appropriate authority shall select to apply in its area, to the date on which the altered rate is to take effect.
Where—
a claimant performs a service for another person; and
that person makes no payment of earnings or pays less than that paid for a comparable employment in the area,
the appropriate 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; but this paragraph shall not apply to a claimant who is engaged by a charitable or voluntary body or is a volunteer if the appropriate authority is satisfied that it is reasonable for him to provide his services free of charge.
Where a claimant is treated as possessing any income under any of paragraphs (1) to (3), 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.
Where a claimant is treated as possessing any earnings under paragraph (5), 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 20 (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—
an amount in respect of income tax equivalent to an amount calculated by applying to those earnings F4the lower rate or, as the case may be, the lower rate and the basic rate of tax in the year of assessment in which the claim was made less only the personal relief to which the claimant is entitled under sections 257(1), (6) and (7) and 259(1)(a) and (2) of the Income and Corporation Taxes Act 1988 (personal relief) as is appropriate to his circumstances; but, if the assessment period is less than a year F5, the earnings to which the lower rate and, if appropriate, the basic rate of tax is to be applied and the amount of the personal relief deductible under this sub-paragraph shall be calculated on a prorata basis;
an amount in respect of primary Class 1 contributions payable under the Contributions and Benefits Act 1992 in respect of those earnings; and
one-half of any sum payable by the claimant by way of a contribution towards an occupational or personal pension scheme.
In paragraph (3), the expression “ordinary clothing or footwear” means clothing or footwear for normal daily use, but does not include school uniforms, or clothing or footwear used solely for sporting activities.
Annotations
Textual amendments
- F1
Words in reg. 26(3) inserted (14.5.1993) by The Income-related Benefits Schemes and Social Security (Recoupment) Amendment Regulations 1993 (S.I. 1993/1249), regs. 1(1)(a), 6(3)(a)
- F2
Words in reg. 26(3) substituted (22.4.1993) by The Social Security Benefits (Miscellaneous Amendments) (No. 2) Regulations 1993 (S.I. 1993/963), regs. 1, 5(3)(4)
- F3
Word in reg. 26(3)(a) substituted (1.4.1993 immediately after art. 20 of S.I. 1993/349 comes into force) by The Council Tax Benefit (General) Amendment Regulations 1993 (S.I. 1993/688), regs. 1(1), 8(a)
- F4
Words in reg. 26(7)(a) substituted (1.4.1993 immediately after art. 20 of S.I. 1993/349 comes into force) by The Council Tax Benefit (General) Amendment Regulations 1993 (S.I. 1993/688), regs. 1(1), 8(b)(i)
- F5
Words in reg. 26(7)(a) inserted (1.4.1993 immediately after art. 20 of S.I. 1993/349 comes into force) by The Council Tax Benefit (General) Amendment Regulations 1993 (S.I. 1993/688), regs. 1(1), 8(b)(ii)