FAQ
Earnings and Earnings Disregards
Q. What counts as earnings?
A. Earnings (for employed earners) are defined in Housing Benefit Regulation 28 and include:
- bonus or commission;
- holiday pay (except any payable more than four weeks after termination of employment);
- compensation payments (payments made in respect of the termination of employment);
- retainers;
- expenses not wholly, exclusively and necessarily incurred in the performance of the duties of the employment (e.g. childcare costs and travelling expenses to work);
- certain employment rights payments;
- certain non-cash vouchers.
Q. Why are work-related expenses not deducted when calculating earnings?
A. People in full-time work normally have to meet their own employment expenses, such as fares to work. There is no allowance for such expenses generally, ensuring standard treatment and removing possible disincentives to take up full-time work. As a special measure there is a childcare disregard in Housing Benefit and Council Tax Benefit, to help those with Childcare responsibilities to move into full-time work.
Q.Who gets what earnings disregard?
A. The standard disregard for single people is £5 a week.
The standard disregard for couples £10 a week.
There is a higher disregard of £20 a week for *certain groups.
Q. Who qualifies for the higher £20 earnings disregard?
A. People in certain groups, such as lone parents, carers and people with disabilities are eligible for the higher disregard. In addition, people in certain special occupations are also eligible for the higher disregard e.g. coastguards and firefighters in recognition of the services they provide and the potential hazards they face in undertaking these duties.
Q. Why have an earnings disregard?
A. The disregards are designed to achieve a balance between providing an encouragement to undertake part-time work and remain in touch with the labour market, without creating disincentives to full-time work and independence.