Pension

Benefits, finances and funding
1

Hi there,
I’m new to the forum and wondering if someone can help me figure something out.
I’m a carer to my sister, Tuesday to Friday which has made me inflexible for work apparently :roll_eyes:
I’ve managed to get a job at the weekend starting soon but the weekly pay is about £144, I can’t for the life of me figure out how much I’d need to put into a pension to bring it back down to £123. Do any of you know?
Many Thanks

2

Example

If you earn £125 a week (after tax and national insurance) you will not be entitled to Carer’s Allowance. However, if you put £10 a week into a pension, half of the £10 can be deducted from your earnings. Your earnings for Carer’s Allowance would therefore be £125 - £5 = £120 a week. As this is not over the earnings limit, you could claim Carer’s Allowance.

So in your case you would need to put minimum £42 per week into a pension pot, then you can deduct 50% of that (i.e. £21 to bring your gross weekly earnings down to £123), although we would recommend that you put a little bit more in to cover any week that your earnings may fluctuate.

Also note that the threshold will e increasing from April 2020

The earnings limit for Carer’s Allowance will be £128 per week from 6 April (rather than £123 - 2019/20)

3

Allicia, would you like to tell us more about your sister? It may be that there are other options available to you that no one has explained.

4

Hi Alicia,

Please beware If you are claiming any income related benefits such as Council Tax discount / Housing Benefit / Universal credit etc this can complicated things further.

Melly1

5

Hi I just came from a Tribunal, appealing against the withdrawal of my Carer’s Allowance from April 2017 to January 2018 on the basis that my earnings exceeded the limit at that time. I miscalculated when I deducted income tax from my profit. Apparently your earnings/ profit have to exceed the tax threshold and then the tax paid on earnings/profit over that can be deducted. My earnings/profit, after expenses did not reach the £11k threshold at that time so the £1760 income tax I paid on those earnings/profit could not be included in the calculations.

How can anyone earn more than the threshold, after expenses, and still use the income tax they pay on that income to bring it below the Carer’s allowance limit? It seems impossible to do?