AIBU to question whether UC rules create incentives to limit earnings?

[Justwonderingum]

Unpopular topic, I know. But I'm trying to understand how UC works. It looks to me like there is a huge gap where you are much better off limiting the hours you work, paying yourself less from your company, or even over paying into your pension as you can claim the difference in UC. Also claiming UC means you pay less for many other things, and will include free school meals soon too. So AIBU to wonder if this really is the case or are these loopholes closed? A quick play seems to suggest that even on a household income of £70000 can claim over £1000 a month, assuming 2 plus kids,including one with lower rate DLA

Can you post your findings? Maybe a screen shot?

Another attempt to divide and conquer comrade? There's already plenty of threads full of hate for you to enjoy.

UC covers several benefits. Including job seekers, people too sick to work, people who are looking after people who are too sick to work, people who have young kids, and people who do not earn enough to live.

What is your point?

Oh, here we go again. Central office’s orders this weekend are clearly ‘benefits bad, go seed division’. People need to realise they are being manipulated by unscrupulous agents.

UC is based on your “entitlement” minus your deductions. It works on a taper system, so for every £1 you earn, they top your earnings up by 45p.

You’re always better off earning more if you are able to work, it’s not like legacy benefits where working more than a certain number of hours could cut your entitlement altogether.

www.gov.uk/universal-credit/what-youll-get

Leaving aside UC eligibility (which can be very high in London especially)... the Savings limit does seem conterproductive. Savings help people improve their position (training coyrses, housing deposits etc)

They should put the allowance up, £6,000 is nothing, particularly if you're on a low income and would struggle to get credit - and I've been saying that for years, long before I was in a situation where income wise I'd be eligible for UC but savings mean I'm not.

I'm struggling to add the screenshot. But 2 parents, working 25 hours each, earning £70000 a year between them, 4 children, one with low rate DLA. Rent £1400. UC entitlement £2200 plus £300 child benefit. Your children will benefit from you working less hours as more time, but money remains the same if not better. Dont understand the tapering, but that's a lot to taper off.

Is that the entitlement after deductions from earnings?

Mumsnet is absolutely flooded with UC threads this week and frankly, it's all a bit grim. And completely transparent.

Yes that's after deductions according to Entitled to

Though I do agree that the sudden drop to entitled to the added extras uc can get you to being cut off could be rather large.

Just look come September free school meals. Thats what £2.50? per day per child. Even two children that’s £25 a week you’ve suddenly lost because you now earn £1 too much.

So the £70000 is taxed and NI and then payment of UC is on top

Wha job can I work 25 hours and earn 35k please

If their earnings are £75k, they won’t be eligible for any UC?

Band 6 nurse or midwife.

If all their components add up you can.

There is no maximum earnings limit.

I just think there must be a point where it is not better to work as many hours financially and it is clearly better for your kids to have parents at home as much as possible

A job that needs a degree. So easy to get.

I agree if earning £10 more a month cost me £100 in just say lunches alone what would be the point in that small increase.

Only fans 🪭

Mmm it's tempting

I'm assuming they would get even more top up if working at minimum wage. £2000 UC is worth £3000 before tax. So equivalent of over £100k per year. And still get free school meals etc

You’re wrong. I get a UC top up. When I got a better paying job and increased my hours from 22.5 to 30 I became £500 a month better off.