UC working without pay

JB2023

My wife has been looking after my sister who is disabled for a long time taking her shopping and making sure she pays her bills. 

My wife gets UC and PIP however my sisters social worker has said they would like my wife to be her carer and can back pay her from May 2023 when her contract would have started.  

So because her contract will say starting May 2023 but UC have had no earnings until the back payment will she get in trouble for not saying she was working and will she have to pay Universal credit back from all the months she was “employed”? Or will they just see the back pay come in and deduct it off the month it comes in? 

We obviously didn’t know that it would be classed as work until the social worker said we can back pay. 

My wife also gets LWCWRA

poppy123456

No she won't get into touble. UC entitlement is based on earnings received during each assessment period. As she's starting to work then she needs to report a change of circumstances and tell them she's working. If you have access to a journal then she can do this on there.

As she has LCWRA then you'll also be entitled to the work allowance. This means either her or yourself can receive a certain amount of earnings each month before the 55% deductions apply. If you claim for help with the rent it will be £379/month, if you don't then it will be £631/month. See link regarding work allowance. https://www.gov.uk/guidance/universal-credit-and-earnings

Will she be self employed or PAYE? If the latter then her employer should report her earnings to HMRC and then UC will check with them for her earnings. If she's self employed she will need to make sure she reports her earnings and any expenses on her journal each month.

The only issue being that when she receives the lump sum that she's owed from May 2023, depending on how much it is and what your maximum UC entitlement is then your UC for that month maybe reduced to zero.

Please also be aware that if the work she does contradicts the reasons why she was found to have LCWRA then it could go against her at her next review.