Regulation 113 Notional capital

(1)

A claimant shall be treated as possessing capital of which he has deprived himself for the purpose of securing entitlement to a jobseeker’s allowance or increasing the amount of that allowance, or for the purpose of securing entitlement to or increasing the amount of income support, except—

(a)

where that capital is derived from a payment made in consequence of a personal injury and is placed on trust for the benefit of the claimant; or

(b)

to the extent that the capital he is treated as possessing is reduced in accordance with regulation 114 (diminishing notional capital rule); F1or

F2(c)

any sum to which paragraph 42(2)(a) of Schedule 8 (capital to be disregarded) applies which is administered in the way referred to in paragraph 42(1)(a); or

(d)

any sum to which paragraph 43(a) of Schedule 8 refers.

(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)

any loan which would be obtainable only if secured against capital disregarded under Schedule 8; or

(d)

a personal pension scheme; F3or

F4(da)

an occupational pension scheme F5or a payment made by the Board of the Pension Protection Fund where the claimant F6has not attained the qualifying age for state pension credit; or

F7(e)

any sum to which paragraph 42(2)(a) of Schedule 8 (capital to be disregarded) applies which is administered in the way referred to in paragraph 42(1)(a); or

(f)

any sum to which paragraph 43(a) of Schedule 8 refers,

any capital 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 him but only from the date on which it could be expected to be acquired were an application made.

(3)

F8Any payment of capital, other than a payment of capital specified in F9paragraph (3A) or (3B) made—

(a)

to a third party in respect of a single claimant or ~~F10in respect of a member of the family~~ his partner shall be treated—

F11(ia)

in a case where that payment is a payment of an occupational pension F12, a pension or other periodical payment made under a personal pension scheme or a payment made by the Board of the Pension Protection Fund, as possessed by that single claimant or, as the case may be, by ~~F13that member~~ the claimant’s partner;

(i)

in a case where that payment is derived from a payment of any benefit under the F14benefit Acts, a payment from the Armed Forces and Reserve Forces Compensation Scheme, a war disablement pension, war widow’s pension or war widower’s pension or a pension payable to a person as a widow, widower or surviving civil partner under any power of Her Majesty otherwise than under an enactment to make provision about pensions for or in respect of persons who have been disabled or have died in consequence of service as members of the armed forces of the Crown, as possessed by that single claimant, if it would normally be paid to him, or as possessed ~~F15by that member of the family, if it would normally be paid to that member~~ by his partner, if it would normally be paid to his partner;

(ii)

in any other case, as possessed by that single claimant ~~F16or by that member of the family~~ or his partner to the extent that it is used for the food, ordinary clothing or footwear, household fuel, rent for which housing benefit F17is payable or any housing costs to the extent that they are met under regulation 83(f) F18, 84(1)(g), 86A(d) or 86B(e)F19..., of that single claimant or, as the case may be, ~~of any member of the family~~ of his partner , or is used for any council tax or water charges for which that claimant or ~~member is liable~~ partner is liable;

(b)

F20to a single claimant or a member of the family in respect of a third party (but not in respect of another member of the 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 by or on behalf of any member of the family.

to a single claimant or his partner in respect of a third party (but not in respect of another member of his family) shall be treated as possessed by that single claimant or, as the case may be, his partner, to the extend that it is kept or used by him or used by or on behalf of his partner.

C1(F213A)

Paragraph (3) shall not apply in respect of a payment of capital made—

(a)

under F22or by the Macfarlane Trust, the Macfarlane (Special Payments) Trust, the Macfarlane (Special Payments) (No.2) Trust, the Fund, the Eileen Trust F23, MFET Limited F24, the Independent Living F25Fund (2006) F26, the Skipton Fund F27, the Caxton Foundation F28, the Scottish Infected Blood Support Scheme F29, an approved blood scheme F30, the London Emergencies Trust, the We Love Manchester Emergency Fund F31, the National Emergencies Trust F32, the Victims of Overseas Terrorism Compensation Scheme or the London Bombings Relief Charitable Fund; or

(b)

pursuant to section 2 of the Employment and Training Act 1973 in respect of a person’s participation—

(i)

in an employment programme specified in regulation 75(1)(a)(ii);

(ii)

in a training scheme specified in regulation 75(1)(b)(ii); or

(F33iia)

F34... in the Intensive Activity Period specified in regulation 75(1)(a)(iv); or

(iii)

in a qualifying course within the meaning specified in regulation 17A(7)F35; or

(iv)

in the Flexible New Deal;

F36(bb)

in respect of a person's participation in the Mandatory Work Activity Scheme;

F37(bc)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F38(bc)

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;

F39(bd)

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;

F40(be)

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;

F41(c)

under an occupational pension scheme F42, 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 1980;

(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 ~~F43any member of his family~~ his partner (if any) does not possess, or is not treated as possessing, any other income apart from that payment.

F44(3B)

Paragraph (3) shall not apply in respect of F45any of the following payments of capital—

(a)

a Grenfell Tower payment;

(b)

a child abuse payment;

(F46c)

a Windrush payment;

(d)

a Post Office compensation payment;

(e)

a vaccine damage payment;

(f)

an LGBT Financial Recognition Scheme paymentF47;

(g)

a miscarriage of justice compensation payment.

(4)

Where a claimant stands in relation to a company in a position analogous to that of a sole owner or a partner in the business of that company, he shall be treated as if he were such sole owner or partner and in such a case—

(a)

the value of his holding in that company shall, notwithstanding regulation 108 (calculation of capital), be disregarded; and

(b)

he shall, subject to paragraph (5), be treated as possessing an amount of capital equal to the value or, as the case may be, his share of the value of the capital of that company and the foregoing provisions of this Chapter shall apply for the purposes of calculating that amount as if it were actual capital which he does possess.

(5)

For so long as the claimant undertakes activities in the course of the business of the company, the amount which he is treated as possessing under paragraph (4) shall be disregarded.

(6)

Where a claimant is treated as possessing any capital under any of paragraphs (1) to (4) the foregoing provisions of this Chapter shall apply for the purposes of calculating the amount of that capital as if it were actual capital which he does possess.

(7)

For the avoidance of doubt a claimant is to be treated as possessing capital under paragraph (1) only if the capital of which he has deprived himself is actual capital.

(8)

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: Reg. 113(1)(c) added (with effect in accordance with reg. 1(2)(3) of the amending S.I.) by The Income-related Benefits and Jobseekers Allowance (Amendment) (No. 2) Regulations 1997 (S.I. 1997/2197), regs. 1(2), 6
F2: Reg. 113(1)(c)(d) substituted for reg. 113(1)(c) (2.4.2007) by The Social Security (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/719), regs. 1(2), 3(5)(a)
F3: Reg. 113(2)(e) and word added (with effect in accordance with reg. 1(2)(3) of the amending S.I.) by The Income-related Benefits and Jobseekers Allowance (Amendment) (No. 2) Regulations 1997 (S.I. 1997/2197), regs. 1(2), 6
F4: Reg. 113(2)(da) inserted (6.4.2006) by The Social Security (Miscellaneous Amendments) (No. 2) Regulations 2005 (S.I. 2005/2465), regs. 1(5)(b), 3(5)
F5: Words in reg. 113(2)(da) inserted (6.4.2006) by The Social Security (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/588), regs. 1(9), 3(4)(a)
F6: Words in reg. 113(2)(da) substituted (6.4.2010) by The Social Security (Miscellaneous Amendments) (No. 2) Regulations 2010 (S.I. 2010/641), regs. 1(1), 4(9)
F7: Reg. 113(2)(e)(f) substituted for reg. 113(2)(e) (2.4.2007) by The Social Security (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/719), regs. 1(2), 3(5)(b)
F8: Words in reg. 113(3) substituted (24.9.1998) by The Social Security Amendment (New Deal) (No.2) Regulations 1998 (S.I. 1998/2117), regs. 1(1), 3(1)(a)
F9: Words in reg. 113(3) substituted (15.7.2020) by The Social Security (Income and Capital) (Miscellaneous Amendments) Regulations 2020 (S.I. 2020/618), regs. 1, 3(5)(a)
F10: Words in reg. 113(3)(a) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(a)(i)
F11: Reg. 113(3)(a)(ia) inserted (15.11.1999) by The Social Security Amendment (Notional Income and Capital) Regulations 1999 (S.I. 1999/2640), regs. 1(1), 2(1)(b)
F12: Words in reg. 113(3)(a)(ia) substituted (6.4.2006) by The Social Security (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/588), regs. 1(2), 3(4)(b)
F13: Words in reg. 113(3)(a)(ia) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(a)(iii)
F14: Words in reg. 113(3)(a)(i) substituted (5.1.2009) by The Social Security (Miscellaneous Amendments) (No. 7) Regulations 2008 (S.I. 2008/3157), regs. 1(1), 3(6)
F15: Words in reg. 113(3)(a)(i) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(a)(ii)
F16: Words in reg. 113(3)(a)(ii) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(a)(iv)
F17: Words in reg. 113(3)(a)(ii) substituted (8.4.2002) by The Social Security Amendment (Residential Care and Nursing Homes) Regulations 2001 (S.I. 2001/3767), Sch. Pt. 2 para. 11(a)(i)
F18: Words in reg. 113(3)(a)(ii) substituted (19.3.2001) by The Jobseeker’s Allowance (Joint Claims) Regulations 2000 (S.I. 2000/1978), reg. 1(1), Sch. 2 para. 44
F19: Words in reg. 113(3)(a)(ii) omitted (8.4.2002) by virtue of The Social Security Amendment (Residential Care and Nursing Homes) Regulations 2001 (S.I. 2001/3767), Sch. Pt. 2 para. 11(a)(ii)
F20: Reg. 113(3)(b) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(b)
F21: Reg. 113(3A) inserted (24.9.1998) by The Social Security Amendment (New Deal) (No.2) Regulations 1998 (S.I. 1998/2117), regs. 1(1), 3(1)(b)
F22: Words in reg. 113(3A)(a) inserted (6.4.2010) by The Social Security (Miscellaneous Amendments) (No. 2) Regulations 2010 (S.I. 2010/641), regs. 1(1), 4(8)(c)
F23: Words in reg. 113(3A)(a) inserted (6.4.2010) by The Social Security (Miscellaneous Amendments) (No. 2) Regulations 2010 (S.I. 2010/641), regs. 1(1), 4(3)(d)
F24: Words in reg. 113(3A)(a) substituted (4.10.2004) by The Social Security (Miscellaneous Amendments) (No. 3) Regulations 2004 (S.I. 2004/2308), regs. 1(1), 3(1)(2)(d)
F25: Words in reg. 113(3A)(a) substituted (17.11.2008) by The Social Security (Miscellaneous Amendments) (No.6) Regulations 2008 (S.I. 2008/2767), regs. 1(2), 4(7)(b)
F26: Words in reg. 113(3A)(a) substituted (12.12.2005) by The Income-related Benefits (Amendment) (No. 2) Regulations 2005 (S.I. 2005/3391), regs. 1, 5(3)
F27: Words in reg. 113(3A)(a) inserted (31.10.2011) by The Social Security (Miscellaneous Amendments) (No. 3) Regulations 2011 (S.I. 2011/2425), regs. 1(2), 10(10)
F28: Words in reg. 113(3A)(a) inserted (3.4.2017) by The Social Security (Scottish Infected Blood Support Scheme) Regulations 2017 (S.I. 2017/329), regs. 1, 4(3)(c)
F29: Words in reg. 113(3A)(a) inserted (23.10.2017) by The Social Security (Infected Blood and Thalidomide) Regulations 2017 (S.I. 2017/870), regs. 1, 3(3)(c)
F30: Words in reg. 113(3A)(a) inserted (19.6.2017) by The Social Security (Emergency Funds) (Amendment) Regulations 2017 (S.I. 2017/689), regs. 1, 3(3)(c)
F31: Words in reg. 113(3A)(a) inserted (15.7.2020) by The Social Security (Income and Capital) (Miscellaneous Amendments) Regulations 2020 (S.I. 2020/618), regs. 1, 3(5)(b)
F32: Words in reg. 113(3A)(a) inserted (27.10.2023) by The Social Security (Habitual Residence and Past Presence, and Capital Disregards) (Amendment) Regulations 2023 (S.I. 2023/1144), regs. 1(1), 4(3)(b)
F33: Reg. 113(3A)(b)(iia) inserted (9.4.2001) by The Social Security Amendment (New Deal) Regulations 2001 (S.I. 2001/1029), regs. 1(1), 8
F34: Words in reg. 113(3A)(b)(iia) omitted (14.4.2008) by virtue of The Social Security (Miscellaneous Amendments) Regulations 2008 (S.I. 2008/698), regs. 1(1), 4(12)(b)
F35: Reg. 113(3A)(b)(iv) and word inserted (5.10.2009) by The Social Security (Flexible New Deal) Regulations 2009 (S.I. 2009/480), regs. 1(3), 2(7)
F36: Reg. 113(3A)(bb) inserted (25.4.2011) by The Jobseeker’s Allowance (Mandatory Work Activity Scheme) Regulations 2011 (S.I. 2011/688), regs. 1, 13(1)(d)(2)
F37: Reg. 113(3A)(bc) omitted (12.2.2013) by virtue of Jobseekers (Back to Work Schemes) Act 2013 (c. 17), ss. 1(14), 3(2) (with s. 1(10))
F38: Reg. 113(3A)(bc) inserted (12.2.2013 at 6.45pm) by The Jobseeker’s Allowance (Schemes for Assisting Persons to Obtain Employment) Regulations 2013 (S.I. 2013/276), regs. 1, 10
F39: Reg. 113(3A)(bd) inserted (temp. until 30.4.2015) (18.7.2014) by The Jobseeker’s Allowance (Supervised Jobsearch Pilot Scheme) Regulations 2014 (S.I. 2014/1913), regs. 1(1), 12
F40: Reg. 113(3A)(be) inserted (temp. until 24.11.2016) (25.11.2014) by The Jobseeker’s Allowance (18-21 Work Skills Pilot Scheme) Regulations 2014 (S.I. 2014/3117), regs. 1(1), 16(1)(c)(2)
F41: Reg. 113(3A)(c) added (15.11.1999) by The Social Security Amendment (Notional Income and Capital) Regulations 1999 (S.I. 1999/2640), regs. 1(1), 2(3)(d)
F42: Words in reg. 113(3A)(c) substituted (6.4.2006) by The Social Security (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/588), regs. 1(2), 3(4)(c)
F43: Words in reg. 113(3A)(c)(iii) substituted (for specified purposes and with effect in accordance with reg. 1(6)(7)(8) of the amending S.I.) by The Social Security (Working Tax Credit and Child Tax Credit) (Consequential Amendments) Regulations 2003 (S.I. 2003/455), Sch. 2 para. 13(c)
F44: Reg. 113(3B) inserted (15.7.2020) by The Social Security (Income and Capital) (Miscellaneous Amendments) Regulations 2020 (S.I. 2020/618), regs. 1, 3(5)(c)
F45: Words in reg. 113(3B) substituted (1.1.2022) by The Social Security (Income and Capital Disregards) (Amendment) Regulations 2021 (S.I. 2021/1405), regs. 1, 3(5)
F46: Reg. 113(3B)(c)-(f) substituted for Reg. 113(3B)(c)-(e) (28.2.2025) by The Social Security (Income and Capital Disregards) (Amendment) Regulations 2025 (S.I. 2025/44), regs. 1(1), 3(5)
F47: Reg. 113(3B)(g) inserted (22.7.2025) by The Social Security (Income and Capital Disregards) (Amendment) (No. 2) Regulations 2025 (S.I. 2025/778), regs. 1(1), 3(5)

Modifications

C1: Reg. 113(3A) modified (22.11.2010) by The Jobseeker’s Allowance (Work for Your Benefit Pilot Scheme) Regulations 2010 (S.I. 2010/1222), regs. 1(2), 15

Notes on the whole SI

Textual amendments

F1: 1995 c.18.
F2: Section 35(1) is an interpretation provision: it is cited because it contains powers exercised in these Regulations in the definitions of “employment", “jobseeker's period", “pensionable age", “pensionable payments", “training" and “work" and because of the meaning assigned to the words “prescribed" and “regulations".
F3: 1992 c.5; section 191 is an interpretation provision and it is cited because of the meaning ascribed to the word “prescribed".
F4: 1992 c.4; sections 171D and 171G(2) were inserted by the Social Security (Incapacity for Work) Act 1994 (c.18), section 6(1) and have effect for the purposes of the Jobseekers Act 1995 by virtue of paragraph 2 of Schedule 1 to that Act. Section 171G(2) is an interpretation provision and is cited because of the meaning ascribed to the word “prescribed".
F5: See section 173(5)(b) of the Social Security Administration Act 1992 (c.5).