Work of fewer than 6 months just does not pay.

gov.uk wrote:Surplus earnings
If your monthly earnings are more than £2,500 over the amount where your payment stopped, this becomes ‘surplus earnings’.

Your surplus earnings will be carried forward to the following month, where they count towards your earnings. If your earnings (including your surplus earnings) are then still over the amount where your payment stops, you will not get a Universal Credit payment.

If your earnings fall below the amount where your payment stopped, your surplus will decrease. Once your surplus has gone, you’ll be able to get a Universal Credit payment again.

You’ll need to reclaim Universal Credit every month until your earnings have reduced enough to get another payment.

You can talk to your work coach for more information about surplus earnings.

The statement in your online journal will show your work allowance and when the surplus reduces.

ND wrote:First claim since the old award terminated

If this is the first claim made since the old award terminated, the surplus earnings are calculated as follows:

Work out the total 'earned income' in the month that would have been the final assessment period of the old award (had it not been terminated)
Deduct the 'relevant threshold' for the month that would have been the final assessment period of the old award (had it not been terminated) from the figure in Step 1.

This amount is known as the 'original surplus'. This amount will be added to the new claim as earned income.

Continues for subsequent claims....

Caker wrote:I wonder if this is the source material / internal guidance that DWP workers are being given.

I am not surprised they are giving out confusing advice as this is very confusing:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/407122/universal-credit-surpluses-and-self-employed-losses-ssac-report.pdf


George, the Fenwick family and Neelam (worked examples in Annexe A) all seem better off on UC.


I feel discombobulated  

If anyone can explain any of this I will be ever so grateful. My WC is not able to go through a worked example calculation with me but merely said that a DM will decide (after the fact). That is not useful when I really want to know in advance how my (potential) earnings will be affected.

Non Deficere wrote:It’s important that you make a Universal Credit claim even if you think you won’t be able to receive a payment because of surplus earnings from a previous month. Making the claim will reduce the amount of surplus earnings that is taken into account for later months. If you don’t make a claim, the amount of surplus earnings that is taken into account will stay the same. Surplus earnings will stop being taken into account 6 months after they were received.

Dan Bloom & Gareth Bartlett wrote:What's happening?

In a bid to make things fairer, the government is changing how it deals with surplus earnings.

When you reapply for UC, you'll now have any surplus earnings you've racked up in the previous 6 months taken into account.

We asked one welfare expert how this actually works, and very roughly speaking, they put it to us like this.

Say you have a bumper month in May and earn £3,000 over the threshold. But then in June you're £300 under it. You still won't get UC.

That's because when you put the two months together, you're still over the threshold by £2,700.

What has happened, however, is £300 of your surplus pot has been 'erased' - and that'll keep happening as the months tick by.

So if you have a really bad month in July, and you're £2,800 under the threshold, you'll start being able to claim benefits again because you've dipped £100 under the threshold.

(These numbers are all made-up to make the policy easy to explain).


Why is it controversial?

It might all look pretty sensible. But the SSAC - whose job is to spot problems in new welfare laws - has raised three big problems.

Number one: to chip away at a surplus, some people will have to put in a claim every month for UC -knowing full well they won't get it.

That's for the situation we just explained above. So it's if you have one really good month, suddenly have a surplus, and have to chip away at it.

Number two: other people, seasonal workers for example, could actually be better off if they DON'T reapply every month.

Say you have a summer job with a big payoff in June, July and August, but terrible pay the rest of the year.

You could come off UC in June, not bother reapplying in July and August, and then when you re-claim in September, you won't have too many surplus earnings to take into account.

Number three, and this is the biggest one. The SSAC says this whole policy is just way too complicated.

How are people supposed to know if they're in group one - who must claim every month - or group two, who are better off the opposite way round?