Council Tax Arrears

carolten

Hello, I am asking this question for a friend they have council tax arrears and have had to complete an income and expenditure form does anyone know if pip is included on the form and disregarded or it is included as income. Thank You.

jdug

pip is disregarded, it is not an income it is regarded as necessary expense

carolten

Thank you I will let him know

2oldcodgers

Sorry but I think you are wrong.

The council WILL include PIP as an income and you will have to show how you spend it on appropriate disability related costs. 

Alex_Scope

That's not quite correct @2oldcodgers, a council might ask what benefits you are in receipt of, but you do not have to prove that you spend it on 'appropriate disability costs'. There has never been an expectation or need for claimants to do that.

It's also worth bearing in mind the following, from Benefits and work:

PIP does not count as taxable income, so it has no effect on the amount of tax you pay. In this regard, PIP is the same as DLA, which is also tax-free income.

Also, PIP, like DLA, is payable whether you are in or out of work and regardless of how many hours you work or how much you earn.

And Gov.uk:

PIP is tax free. The amount you get is not affected by your income or savings.

As others have mentioned @carolten, you can disregard PIP from income. 

poppy123456

2oldcodgers said:

Sorry but I think you are wrong.

The council WILL include PIP as an income and you will have to show how you spend it on appropriate disability related costs. 

That's very misleading information you've given here and isn't correct at all. You really do need to be careful with the advice you give.

calcotti

In my opinion the PIP has to be declared as part of your income. Rules on whether or not the income is taxable or not relevant, otherwise people on means tested benefits only would be able to say they have no income.

Stepchange have a debt pro forma here
https://www.stepchange.org/portals/0/assets/pdf/budget-planner.pdf

It think it is incorrect to ignore the PIP.

poppy123456

poppy123456 said:

2oldcodgers said:

Sorry but I think you are wrong.

The council WILL include PIP as an income and you will have to show how you spend it on appropriate disability related costs. 

That's very misleading information you've given here and isn't correct at all. You really do need to be careful with the advice you give.

Apologies, i should have re-read the thread before commenting because my comment was based on CTR rather than arrears. Usually i'll read the whole thread before commenting and i don't know why i didn't this time.

2oldcodgers

poppy123456 said:

2oldcodgers said:

Sorry but I think you are wrong.

The council WILL include PIP as an income and you will have to show how you spend it on appropriate disability related costs. 

That's very misleading information you've given here and isn't correct at all. You really do need to be careful with the advice you give.

If that be the case then it isn't me that is wrong but the District Council's Council Tax dept.

I owed a small amount of CT due entirely to a change of circumstances and ended up quite incorrectly being charged CT for a 6 week period whilst everything was sorted out - the Pension Service suspended our award for that 6 week period then reinstated it. I was a little slow in notifying them (the Pension Service) of the change and they refused to backdate the Pension Credit award for those 6 weeks hence I was liable to CT for that period.
Anyhow, I refused to pay that CT charge for those 6 weeks which landed me with a debt of just over £250. Eventually they wanted an income and expenses schedule on which I included my PIP (Enhanced Care & Mobility) along with my wife's AA (High Care - Day 7 Night) as income with corresponding  debits as to where the Care elements went.
They told me that PIP & AA were to be treated as joint income.

So I had to pay them the £250+ in one hit as they dictated that we had sufficient income. 

jdug

Most, but not all, taxable state benefits should be included as social security income. PIP is not income. Council have made a mistake ( nothing new there ). Regardless, they should have at least agreed a repayment plan. You should contact Citizens Advice for help or at least clarity

calcotti

2oldcodgers said:

poppy123456 said:

2oldcodgers said:

Sorry but I think you are wrong.

The council WILL include PIP as an income and you will have to show how you spend it on appropriate disability related costs. 

That's very misleading information you've given here and isn't correct at all. You really do need to be careful with the advice you give. 

If that be the case then it isn't me that is wrong but the District Council's Council Tax dept.

Poppy has already acknowledged that her post from as a response to a misreaded of the thread.

poppy123456 said:. 

Apologies, i should have re-read the thread before commenting because my comment was based on CTR rather than arrears. Usually i'll read the whole thread before commenting and i don't know why i didn't this time.

calcotti

jdug said:

Most, but not all, taxable state benefits should be included as social security income. PIP is not income.

I’m not clear why you say PIP is income.

jdug

I'm not. I am trying to say the exact opposite. PIP is NOT income.

calcotti

jdug said:

I'm not. I am trying to say the exact opposite. PIP is NOT income.

Typo in my post, I meant to say I’m not clear why you say PIP is not income (and what in what context).

jdug

Apologies for not making myself clear.

PIP ,IS, a type of income, as is any monies coming into your household whether that be earned, benefits, savings, investments etc. However PIP like some other benefits/allowances ( Child Benefit, Attendance Allowance and Bereavement Support )

are disregarded and not treated as income for fiscal purposes. Effectively NOT income, for fiscal purposes. Again if unsure of any of this go to your local C.A.B 

poppy123456

jdug said:

Apologies for not making myself clear.

PIP ,IS, a type of income, as is any monies coming into your household whether that be earned, benefits, savings, investments etc. However PIP like some other benefits/allowances ( Child Benefit, Attendance Allowance and Bereavement Support )

are disregarded and not treated as income for fiscal purposes. Effectively NOT income, for fiscal purposes. Again if unsure of any of this go to your local C.A.B 

It's not counted as income for Council tax reduction but it's counted as income if you have arrears for CT, which is what this thread is about.

They will look at all your income and expenses when arranging a payment plan to pay what you're owed. Council tax is one bill you should never avoid paying.

jdug

PIP is awarded on the basis that it reflects additional support you require, for increased expenses associated with your needs. As a result, where and if PIP is included in your income, your creditors will usually allow the same amount to be reflected in your expenses, without breakdown. It's not counted as income for benefit arrears, tax arrears, for self-assessment, benefit claims, universal credit and more. The only benefits that can be reduced to pay arrears, including benefit arrears, are non disregarded benefits, which are mostly taxable. Councils dealing with tax arrears have no special rights to ignore the PIP disregard. Councils often have to be reminded of this.

As you are getting conflicting advice I would again urge you to contact an accredited Advice organisation

calcotti

jdug said:

Apologies for not making myself clear.

PIP ,IS, a type of income, as is any monies coming into your household whether that be earned, benefits, savings, investments etc. However PIP like some other benefits/allowances ( Child Benefit, Attendance Allowance and Bereavement Support ) are disregarded and not treated as income for fiscal purposes. Effectively NOT income, for fiscal purposes. Again if unsure of any of this go to your local C.A.B 

Not clear what you mean by ‘fiscal purposes’. Not a term I recognise from any regulations.  

jdug said:….if PIP is included in your income, your creditors will usually allow the same amount to be reflected in your expenses, without breakdown. It's not counted as income for benefit arrears, tax arrears, for self-assessment, benefit claims, universal credit and more. The only benefits that can be reduced to pay arrears, including benefit arrears, are non disregarded benefits, which are mostly taxable. Councils dealing with tax arrears have no special rights to ignore the PIP disregard. Councils often have to be reminded of this.

CT arrears are a debt, the recovery of debt is not, as part as I know, part of the regulations on Council Tax Reduction.

I agree that many creditors will offset PIP with an offset expenditure but I am not of anything that obliges them to do so so I don't know what these ‘special rights’ you refer to are.

Your reference of impact of PIP to other benefits, tax arrears etc is irrelevant to this thread which is about Council Tax arrears.

poppy123456

jdug said:

The only benefits that can be reduced to pay arrears, including benefit arrears, are non disregarded benefits, which are mostly taxable.

That's not correct. Income Related benefits (which aren't taxable) can also be reduced to pay 3rd party debt.