How to enter surplus earnings into the Benefit and Budgeting Calculator - YouTube

Hi there, I'm Duncan from Policy in Practice and I'm going to talk you through how our

Benefit and Budgeting Calculator can be used to simplify the impact of surplus earnings on your client.

The Universal Credit surplus earnings regulations

govern the treatment of spikes in income. The theory behind them is that if people

have irregular earnings which vary for month to month or from assessment period

to assessment period, any large payments in one month can be partially saved by a

claimant to cover their costs in the subsequent months meaning they won't be

paid as much Universal Credit in that month.

The regulations can be very

complex and often require month to month calculations in order to advisors to

assist claimants particularly as claimants will need to be forewarned

about coming household income fluctuations and will probably need to

set aside some income to cover subsequent months during which the

Universal Credit award will be reduced. That's where our Benefit and Budgeting

Calculator can help by taking these complex rules and making it really

straightforward for a client to understand how the rules will impact them.

So you can see here I've started a case receiving regular earnings and we

can see the benefits they would be getting and that's on our results tab.

If we move to the Universal Credit calendar tab we can then see how that

income breaks down monthly and because we have regular earnings we also have

regular Universal Credit payments and level income that is steady every month because

of that monthly earnings. So that's great for people who have a steady monthly

wage but for those who have had more irregular earnings for instance those

who might be in receipt of a Self Employed Income Support Scheme

which can payout up to £7,500 in one go to cover 3 months of lost

earnings, it is a bit more complicated. So let's see what would happen if this claimant

was actually someone who had applied for the Self Employed Income Support grant,

rather than earning a regular monthly wage. So we'll change their earnings or set

them to zero and we'll say they worked nought hours for this bit you can then

go back to the results and then the Universal Credit calendar

so we can say they are now receiving earnings paid on an irregular basis yes.

We can then break down when you receive those irregular earnings. Now the first

round of the Self Employed Income Support Scheme should have paid out in June.

So that would be 80% of someone's earnings over the last three

months and in this case we'll say they received £6,250.

Then there's a Self Employed Income Support Scheme

and in that round you can receive 70% of earnings so in this

case £5.470 and you can apply for that round in

August and you might receive it in September we'll say for this case.

So we then put in some large but irregular earnings to cover several months without our usual

self employed earnings. Let's see how that impacts what we'll be receiving a

in Universal Credit from month to month.

We can see here it's not steady as it was before with the regular traditional innings.

You can see in the first assessment

period covering May and paid in early June the Universal Credit award is

normal as it was before but it's then that we look in July when the large

grant means that Universal Credit goes down to nought we can see here, but the total

income is actually very high because it includes that a large grant.

Then in August we can see that large grant is still impacting the Universal Credit

payments that's just really quite low, just £1,000 then other

income in this period as well is just £66 so overall in that period

they're really receiving not nearly as much as they usually would.

So that's one we need to save part of that self employed grant to cover our

costs in this month, which may be fine though we may also need to bear in mind

that that grant is covering lost earnings due to COVID which potentially

started being disrupted as early as March so there may also be outstanding

historic costs we need to deal with using the grant. If so being forewarned

that overall income in August is going to be so low is crucial if we're to safely

budget to cover both historic and ongoing costs. We can see that

likewise our Universal Credit dips again in October and November so again the

client can be prepared for those very earnings. The more we go into the

policy behind this the more complex it can seem but for the client they just

need to know when and how their income is going to fluctuate so all I need is

this quick calendar here which can handily print off for them using the print

button on the bottom. They can then take it home, pin it to the

fridge and know exactly how far their self employed income support grant will

need to stretch and when they need to be prepared for their Universal Credit to drop.

So there the calculator takes these complex

rules and translates them into a simple to understand calendar showing the

claimant precisely how their income may fluctuate.