Change to capital disregard rules for income-related benefits

Regulations were issued in August expanding the existing capital disregards relating to benefit arrears. Capital, resulting from a benefit arrear payable as a result of an error or on a point of law can now be disregarded for the lifetime of the benefit award. Previously, such capital could only have been disregarded for a maximum period of 52 weeks.

The Social Security (Treatment of Arrears of Benefit) Regulations (Northern Ireland) 2018 also extend the disregards to the same effect for Universal Credit claimants, to ensure that any benefit arrears, or payments made to compensate claimants for non-payment of benefits, as a result of official error or an error on a point of law are disregarded as capital for the lifetime of the claimant’s Universal Credit award.

Subsequent to the introduction of similar legislation in Great Britain, the Department for Work & Pensions has published new guidance on the treatment of arrears of benefit for Universal Credit claimants and for claimants of income-related benefits.