Employment and Support Allowance (ESA)
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Armed forces pension at age 60 - ESA deduction

I am due to receive an armed forces pension and I am on income based ESA, I was previously on incapacity benefits (IB).

I read conflicting reports regarding deduction of ESA rate, I read that those who prior 2001 were on IB, they would keep their full amount of ESA irrespective of private pension.

I would appreciate any feedback.

Replies

  • JulessarahthompsonJulessarahthompson Member Posts: 25 Connected
    My dad receives an army pension and doesnt lose any of his esa, I dont know whether it's because his pension is a low amount, you could always try the entitled too calculated to see if you will have deductions 
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    spb1612 said:
    I am due to receive an armed forces pension and I am on income based ESA, I was previously on incapacity benefits (IB).

    I read conflicting reports regarding deduction of ESA rate, I read that those who prior 2001 were on IB, they would keep their full amount of ESA irrespective of private pension.

    I would appreciate any feedback.

    Hi,

    As you transferred from IB then your ESA must be Contributions based with an Income Related top up. Regardless of the rules any weekly pension you receive will reduce your Income related ESA £1 for £1.

    The rules you're talking about are part of the transitional protection rules for those that transferred from IB to ESA. This means that if a claimants pension was part of those transitional protection rules then it won't affect your Contributions based ESA BUT if they weren't then the protection doesn't apply to you. Regardless of that, the transitional protection rules are due to end in April 2020.

    This means that if your pension is less than £85 per week then it will be disregarded. For anything more than £85 per week then your ESA will be reduced by 50p for every £1 over that amount. Hope this helps.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    My dad receives an army pension and doesnt lose any of his esa, I dont know whether it's because his pension is a low amount, you could always try the entitled too calculated to see if you will have deductions 

    Hi,

    Sounds like your dad is receiving Contributions based ESA, which means any pension of less than £85 per week will be disregarded. Even with that, DWP should still be told about the pension because if it's above £85 per week it will reduced the amount of ESA he's entitled to.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    To add to that information, if you receive a lump sum on top of the weekly pension, if this brings your savings to more than £6.000 then it will affect your Income Related ESA £1 for every £250 over that amount. Savings over £16.000 and you won't be entitled to any means tested benefits. Your Contributions based ESA part will not be affected by savings.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • JulessarahthompsonJulessarahthompson Member Posts: 25 Connected
    Hes on IR esa, the DWP were informed when he recieved his pension but it hasn't affected his payments, he recieves roughly £140 a month pension so in guessing that's why 
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    Hes on IR esa, the DWP were informed when he recieved his pension but it hasn't affected his payments, he recieves roughly £140 a month pension so in guessing that's why 

    If he's definitely claiming Income related ESA and his pension hasn't reduced it then this is not correct, a pension affects Income related ESA £1 for £1 because it's classed as income. See this link and scroll down to 51050 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/843595/dmgch51.pdf

    Although this is dated 2018 the rules have always been the same.


    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • JulessarahthompsonJulessarahthompson Member Posts: 25 Connected
    Hes definitely on IR, and definitely has no deductions from his ESA. Hes had his pension for nearly 2 years, and the DWP are aware of his pension. It was all sorted by a benefits advisor from the British Legion as he was able to claim his pension early through being disabled 
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    Hes definitely on IR, and definitely has no deductions from his ESA. Hes had his pension for nearly 2 years, and the DWP are aware of his pension. It was all sorted by a benefits advisor from the British Legion as he was able to claim his pension early through being disabled 

    I can only tell you what the rules are. I wouldn't want anyone to read this thinking that their pension won't affect the amount of Income Related ESA they are entitled to. May i ask how much ESA he claims per week, this will tell me whether it's definitely CB or Income Related. You'll be amazed the amount of people that contuse the 2.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • JulessarahthompsonJulessarahthompson Member Posts: 25 Connected
    I'm not sure on the exact amount as he has deductions because my mum claims carers but its roughly 150 a week 
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    That means that at least part of his claim is Income Related and as i advised, i can only tell you the rules and that's a pension is counted as income when claiming Income Related ESA.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • JulessarahthompsonJulessarahthompson Member Posts: 25 Connected
    To be honest we expected his pension to affect his ESA and was shocked when it never, he was originally taxed on his pension, but last year ended up receiving a tax rebate for the tax they had taken from his pension. It's so confusing knowing whats right from wrong when it comes to benefits so it defo helps having people like you advising us 
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    edited January 15
    Thanks for the kind words.

    If it was me then i'd be contacting DWP to make sure that it's correct because to me it sounds wrong. If it is incorrect and he has proof that he did contact them then any overpayment would not need to be re-paid back because it will have been an error on DWPs part.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • spb1612spb1612 Member Posts: 12 Listener
    edited January 15
    To add to that information, if you receive a lump sum on top of the weekly pension, if this brings your savings to more than £6.000 then it will affect your Income Related ESA £1 for every £250 over that amount. Savings over £16.000 and you won't be entitled to any means tested benefits. Your Contributions based ESA part will not be affected by savings.
    I am also going to receive a lump sum of £12,000 but I am paying £4,000 of outstanding mortgage, £6,000 credit card loan and DWP overpayment of £5,000.  That will not take me over £6,000.
  • spb1612spb1612 Member Posts: 12 Listener
    When I eventually migrate from ESA to UC, as planned, will the pension rules apply as per ESA.  I read that under UC, pension will be counted £1 per £1, thus I lose all my pension. Will this be the case?
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    spb1612 said:
     I am also going to receive a lump sum of £12,000 but I am paying £4,000 of outstanding mortgage, £6,000 credit card loan and DWP overpayment of £5,000.  That will not take me over £6,000.

    Paying off debts and your mortgage could be classed as deprivation of capital, unless the debts are immediately payable because you're receiving letters demanding payment.

    As soon as you receive that money in the bank you need to report the changes to DWP. That amount of money will reduce your Income related ESA by £20 per week. If part of your ESA is Contributions based and you're receiving £128.45 per week then your will lose the income related top up and just receive the Contributions based, which is £111.65 per week.

    For UC then the rules are the same for pensions because it's a means tested benefif BUT if part of your ESA is Contributions based then you'll always stay on that because it's not part of UC. You will only move across for any income related top up.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • spb1612spb1612 Member Posts: 12 Listener
    When I notify the DWP of receipt of army pension at age 60, would this be considered as a change of circumstances and consequently transferred from ESA to UC?  If so this would result in a considerable loss of benefits.
  • poppy123456poppy123456 Community champion Posts: 18,542 Disability Gamechanger
    No, that's not classed as a change of circumstances to prompt a move to UC.
    Community champion and proud winner of the 2019 empowering others award. This award was given for supporting disabled people and their families for the benefit advice i have given to members here on the community.
  • Justcause2Justcause2 Member Posts: 9 Listener
    edited April 20
    Looking at the ESA Transitional Regulations 2010 I can see a clear reference to April 2020 in regard to Transitional Payments

    www.legislation.gov.uk/uksi/2010/875/regulation/21/made

    but no such reference for the changes to the ESA Regs 2008 that disregard certain pension payments


    www.legislation.gov.uk/uksi/2010/875/schedule/1/mad

    SO correct me if I am wrong but it is Tranitional payments that are ending ing Apriil 2020(which has now already been eroded over time) 

    The date of 5 April 2020 applies only to the payment of a Transitional Addition (or Payment), the amendment to the ESA Regulations 2008 that can disregard certain pension information has no termination date.

    So imo if you are still in receipt of CB ESA since the changeover From IB and are in the Support Group and remain in the Support group with no breaks until this or any date then Transitional protection is still in effect and will remain in effect untill your claim ends.
    And so your occupational pension will still be disregarded in full.
    Regards JC.
  • spb1612spb1612 Member Posts: 12 Listener
    I am on Income Related ESA, I migrated from IB.

    I read somewhere that my pension will not be disregarded. 
  • Justcause2Justcause2 Member Posts: 9 Listener
    HI spb1512 
    I'm sorry if this sounds selfish  but I've only concentrated on CB/ESA as this is what what I'm claiming.
    I am in not in receipt of anything IR and so did not follow the IR rules on the point of changeover.
    All I Know is that i need to stay in the CB/ESA Support group with no breaks to continue to claim both ESA and my personal  pension.
    Kind Regards JC.


  • spb1612spb1612 Member Posts: 12 Listener

    spb1612 said:
     I am also going to receive a lump sum of £12,000 but I am paying £4,000 of outstanding mortgage, £6,000 credit card loan and DWP overpayment of £5,000.  That will not take me over £6,000.

    Paying off debts and your mortgage could be classed as deprivation of capital, unless the debts are immediately payable because you're receiving letters demanding payment.

    As soon as you receive that money in the bank you need to report the changes to DWP. That amount of money will reduce your Income related ESA by £20 per week. If part of your ESA is Contributions based and you're receiving £128.45 per week then your will lose the income related top up and just receive the Contributions based, which is £111.65 per week.

    For UC then the rules are the same for pensions because it's a means tested benefif BUT if part of your ESA is Contributions based then you'll always stay on that because it's not part of UC. You will only move across for any income related top up.

  • spb1612spb1612 Member Posts: 12 Listener
    I see no sense in investing the money in my bank where I would get 0.24% interest on my savings when I am paying 21% APR for my credit card and 3% for my outstanding mortgage. 

    This does not make sense and I would be losing money as a result and it is unreasonable.

    Will I be forced to keep the £5,000 in my bank without spending it, I spend more money than I earn and I have to rely on family for help.

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