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Redundancy pay and wages - benefit help please.


Pat2010
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lm sorry if l am asking this in the wrong place, l have browsed various sites and am still slightly (ok a lot!) confused.

My partner will be receiving his redundancy confirmation this week, we know at some point we will need to claim benefits to help us until he finds a new job, which is hoped wont take too long. This isn't a voluntary redundancy, others were 'laid off' too.

 

What is confusing us most is, will his redundancy pay and wages in lieu be taken into account? lm sure they will but can find no solid proof plus the local job center/benefits wont tell us anything until we have an appointment! Am l right in thinking that the wages in lieu will be our income for how many weeks he has been paid for? So therefore not to make a benefit claim until that number of weeks has passed? Finally his redundancy pay, would we also be expected to make it 'last' us a fixed amount of time before we claim benefits. We have children, one registered disabled....so lm sure we would need to let Child Tax Credit know as soon as he gets confirmation. Were more worried about our mortgage, we may be entitled to help but wondered if paying up front a couple of months using the redundancy payment would be a good idea.

 

Any help,advice would be gratefully received as were finding this whole process quite daunting/worrying.

 

Pat.

Edited by Pat2010
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Hi Pat

 

It will all depend on what your husband claims. If he claims Contribution Based Jobseekers Allowance, his holiday pay, pay in lieu of notice and redundancy pay will not affect him at all. It is a personal "allowance" of around £65 per week (dependant on age). This is usually paid for six months and is based on the national insurance contributions made within the two tax years prior to the one we are in now - eg 2007 - 2008 and 2008 - 2009 april to april. If he was employed full time paying a class one contribution during those two tax years then he should qualify for the six months contribution based. You do not however get help with your mortgage but if you have a mortgage protection plan then you must claim jobseekers allowance to get it paid.

 

For the Income Based Jobseekers Allownce, the rules about holiday pay and pay in lieu of notice changed in late 2008. They no longer affect any benefit as an income but if it is paid as a lump sum and is over £6000 (this would also include any capital or savings that you have at the time of the claim) then your benefit can be reduced (it is usually £1 per £250 or part thereof over £6000, so for instance if you have £6502 in total, your weekly benefit will reduce by £3). If the amount of capital in total is over £16000.00 then you are not entitled to Income Based Jobseekers allowance at all. If you have less than that and Jobseekers allowance is in payment, after 13wks you can get help towards your mortgage.

 

If your husband is laid off but working his notice, he cannot claim until he has finshed working (jobseekers allowance requires you to be available for work whilst you are claiming).

 

Any capital sum (over £6000) would be expected to last a certain amount of time, it would be deemed "unreasonable" for someone for example to spend £20,000.00 on a holiday or something a couple of weeks before claiming an income based benefit. If you did dispose of a large sum of money and then claim benefit you would have to provide evidence of what was spent and how. A decision maker would look at the amount spend and if it is considered "reasonable". I know that sounds really draconian...someone looking at how you spend your money but it is to ensure that the money in the public purse, the money we all pay in tax is paid out correctly.

 

You must declare any changes in your husbands working status to Child Tax credits, it may be that due to the re-calculation you get more child tax credit.

 

 

I hope this is of some help

Edited by MONX

Advice given is my opinion only, I am not a legal or financial expert (far from it).

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Thank you so much for your reply, that helps heaps.

 

We will be lucky if the total redundancy plus wages in lieu reaches £4000, we have no savings, neither do the children. Our £500 mortgage is scaring us but hopefully we can get a little help, l will definitely ask when we visit the benefits office next week, were hoping to get the ppi but have had problems.

 

l am going to let Tax credits know as soon as my partner phones me next Friday to say he has his confirmation, the sooner we can get the ball rolling the calmer we will both feel, but thank you again, your have helped lift a huge weight :-)

 

Pat.

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