New Style ESA- can they change tax years used for NIC

SA2018

Hi

I assisted a family member to apply for NS ESA after being made redundant from work due to long term sick. 

He was put in the support group on 29th Dec 2023 and it was a credit only claim due to them using tax years April 2021 and April 2022 where he did not have full NIC contributions.

His current only source of income is PIP enhanced X2. Not entitled to UC due to savings.

My question is we have requested a Mandatory Reconsideration and asked if they could start the claim from 8th January 2024- this would then mean they would look at tax years April 2022 and April 2023 where he had both years full NI contributions.

No response had been received so far and its been nearly 3 months. He is really unwell in hospital for last three weeks so not really been a priority to contact and chase. 

Would he have to restart a new claim for the correct benefit tax years to be used or would they be able to start paying NSESA now that he has asked for them to change the start date of award. If he cancelled current claim would they link it if a new claim was submitted.

Thanks

poppy123456

They look at the last 2 complete tax years. From 8th April it was 2021/22 and 2022/23. If they didn't qualify due to tax years 2021/22 then they won't qualify now. There's 2 contributions you must meet

• First contribution condition - in one of the last two complete tax years,you must have paid Class 1 or 2 contributions on relevant earnings at the lower earnings limit for at least 26 weeks. This means you must have worked for at least 26 weeks of the last two complete tax years; and
• Second contribution condition - in both of the last two complete tax years, you must have paid or been credited with, Class 1 or 2 contributions on earnings of at least 50 times the lower earnings limit.

The 2 tax years that are relevant are the ones that were completed before the benefit year in which your period of limited capability for work began.https://www.entitledto.co.uk/help/employment-and-support-allowance-contribution-based

SA2018

Hi

Please take a look at below: 

This shows that he would not be eligible to ESA in Dec 2023, however January 2024 they would then surely look at the new tax years ending 5th April 2022 to 5th April 2023. Would he qualify if he ended current claim, and then started a new claim from say 10.01.2024 or even say from now in April?

poppy123456

I believe there’s still going to be an issue with that tax year 2021/22 because for the 2nd contribution they look at both the last 2 complete tax years. 

I’ve flagged your question to a member who of the scope team so they can hopefully advise whether I’m correct or not. 

SA2018

Thanks. I will await a response from other Scope members.

May i also ask:

For the earlier first year 2021 to 2022- it still states Full Contributions even though the amount underneath is lower than that paid for the following year. Am i right in saying to meet that 2nd condition, he would have had to earn a minimum of 50 times the £120 (2022/22 lower limit)- meaning a minimum earning of £6150 fr that year to qualify?

If he does meet this condition- how best to proceed is my main question. Does he just continue with his Mandatory Reconsideration, having put to them to change start date of his claim to 8th January 2024 so they use correct tax years shere he had full NICs or should he just end curret claim- which is credits only that started Dec 2023- and reapply? If to reapply would he ask for a backdate to 8th Jan 24 or nearabouts.

Kind Regards

S

poppy123456

For the 2nd condition they need to have earned 50 times the lower earnings limited for both tax years, which would be 2021/22 and 2022/23. 

Adrian_Scope

Good morning @SA2018.
This is an interesting one and I've not heard of someone changing the start date of their claim (other than to ask for a back date) or changing the years it is based on. 
This isn't my area of expertise but I've spoken to a couple of people who both agreed that the MR is unlikely to change anything and suggested the option of submitting a new claim for NSESA, which will be based on tax years 2021/2022 and 2022/2023. It's my understanding that a credits-only claim isn't actually a claim, so he wouldn't need to cancel the current award in order to submit a new claim.

Before doing anything, I'd definitely recommend getting advice from benefits expert such as Welfare Rights on the matter though. You can find some advisers local to you on the webite Advicelocal.