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The Social Security (Miscellaneous Amendments) (No. 4) Regulations 1998

Type Statutory-Instrument
Publication 1998-05-07
State In force
Department King's Printer of Acts of Parliament
Source legislation.gov.uk
Reform history JSON API PDF

Made: 7th May 1998

Laid before Parliament: 11th May 1998

Coming into force: 1st June 1998

The Secretary of State for Education and Employment, in relation to regulation 3(2) of these Regulations and the Secretary of State for Social Security, in relation to the remainder of these Regulations, in exercise of the powers conferred by sections 12(1), (2) and (4)(b) and (d), 19(10)(c), 21, 35(1) and 36(1), (2) and (4) of, and paragraphs 4 and 10(1) of Schedule 1 to, the Jobseekers Act 1995, sections 123(1), 136(3), (4) and (5)(b), 137(1) and 175(1), (3) and (4) of the Social Security Contributions and Benefits Act and sections 5(1)(i) and 189(1) and (4) of the Social Security Administration Act 1992, and of all other powers enabling each of them in that behalf, after consultation in respect of provisions in these Regulations relating to housing benefit and council tax benefit, with organisations appearing to the Secretary of State for Social Security to be representative of the authorities concerned and after agreement by the Social Security Advisory Committee that proposals in respect of these Regulations should not be referred to it, hereby make the following Regulations:

Citation, commencement and interpretation

1

...

“the Disability Working Allowance Regulations" means the Disability Working Allowance (General) Regulations 1991 ;

“the Family Credit Regulations" means the Family Credit (General) Regulations 1987 ;

...

“the Income Support Regulations" means the Income Support (General) Regulations 1987 ;

“the Jobseeker’s Allowance Regulations" means the Jobseeker’s Allowance Regulations 1996 .

Revocation

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The Jobseeker’s Allowance (Amendment) Regulations 1998 (which increase the number of waiting days for a jobseeker’s allowance from 3 to 7) are hereby revoked.

Amendment of the Jobseeker’s Allowance Regulations

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(aa) the Employment Option of the New Deal, being a programme which lasts for any individual for up to 26 weeks and which includes for that individual— (i) employed earner’s employment, training and support; or (ii) assistance in pursuing self-employed earner’s employment;

(88A) Chapters II, III, IV, V, VII and VIII of this Part and regulations 131 to 136, 138 and 139 shall not apply to any income which is to be calculated in accordance with Chapter IVA of this Part (participants in the self-employment route of the Employment Option of the New Deal).

(102A) In this Chapter— - “self-employment route" means that part of the Employment Option of the New Deal which is specified in regulation 75(1)(a)(ii)(aa)(ii); - “special account" means, where a person was carrying on a commercial activity in respect of which assistance was received under the self-employment route, the account into which the gross receipts from that activity were payable during the period in respect of which such assistance was received. (102B) The gross receipts of a commercial activity carried on by a person in respect of which assistance is received under the self-employment route, shall be taken into account in accordance with the following provisions of this Chapter. (102C) (1) The income of a person who has received assistance under the self-employment route shall be calculated by taking into account the whole of the monies in the special account at the end of the last day upon which such assistance was received and deducting from those monies— (a) an amount in respect of income tax calculated in accordance with regulation 102D (deduction in respect of tax for participants in the self-employment route of the Employment Option of the New Deal); and (b) any sum to which paragraph (4) refers. (2) Income calculated pursuant to paragraph (1) shall be apportioned equally over a period which starts on the date the income is treated as paid under paragraph (3) and is equal in length to the period beginning with the day upon which assistance was first received under the self-employment route and ending on the last day upon which such assistance was received. (3) Income calculated pursuant to paragraph (1) shall be treated as paid— (a) in the case where it is due to be paid before the first benefit week in respect of which the participant or his partner first claims a jobseeker’s allowance following the last day upon which assistance was received under the self-employment route, on the day in the week in which it is due to be paid which corresponds to the first day of the benefit week; (b) in any other case, on the first day of the benefit week in which it is due to be paid. (4) This paragraph refers, where applicable in each benefit week in respect of which income calculated pursuant to paragraph (1) is taken into account pursuant to paragraphs (2) and (3), to the sums which would have been disregarded under paragraphs 5 to 8, 11 and 12 of Schedule 6 had the income been earnings. (102D) (1) The amount to be deducted in respect of income tax under regulation 102C(1)(a) (calculation of income of participants in the self-employment route of the Employment Option of the New Deal) in respect of the period determined under regulation 102C(2) shall be calculated as if— (a) the chargeable income is the only income chargeable to tax; (b) the personal reliefs which are applicable to the person receiving assistance under the self-employment route by virtue of sections 257(1), 257A(1) and 259 of the Income and Corporation Taxes Act 1988 (personal reliefs) are allowable against that income; and (c) the rate at which the chargeable income less the personal relief is assessable to income tax is the lower rate of tax or, as the case may be, the lower rate and the basic rate of tax. (2) For the purpose of paragraph (1), the lower rate of tax to be applied and the amount of the personal relief deductible shall, where the period determined under regulation 102C(2) is less than a year, be calculated on a pro rata basis. (3) In this regulation, “chargeable income" means the monies in the special account at the end of the last day upon which assistance was received under the self-employment route.

Income to be disregarded

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In Schedule 7 to the Jobseeker’s Allowance Regulations (income to be disregarded)—

(60) Any mandatory top-up payment made to a person pursuant to section 2 of the Employment and Training Act 1973 in respect of that person’s participation in an employment programme specified in— (a) regulation 75(1)(a)(ii)(aa)(ii) (self-employment route of the Employment Option of the New Deal); (b) regulation 75(1)(a)(ii)(bb) (Voluntary Sector Option of the New Deal); or (c) regulation 75(1)(a)(ii)(cc) (Environment Task Force Option of the New Deal).

(62) (1) Subject to sub-paragraph (2), in the case of a person who is receiving, or who has received, assistance under an employment programme specified in regulation 75(1)(a)(ii)(aa)(ii) (self-employment route of the Employment Option of the New Deal), any payment to that person— (a) to meet expenses wholly and necessarily incurred whilst carrying on the commercial activity; (b) which is used or intended to be used to maintain repayments on a loan taken out by that person for the purpose of establishing or carrying on the commercial activity, in respect of which such assistance is or was received. (2) Sub-paragraph (1) shall apply only in respect of payments which are paid to that person from the special account as defined for the purposes of Chapter IVA of Part VIII.

Capital to be disregarded

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In Schedule 8 to the Jobseeker’s Allowance Regulations (capital to be disregarded)—

(3) In the case of a person who is receiving assistance under an employment programme specified in regulation 75(1)(a)(ii)(aa)(ii) (self-employment route of the Employment Option of the New Deal), the assets acquired by that person for the purpose of establishing or carrying on the commercial activity in respect of which such assistance is being received. (4) In the case of a person who has ceased carrying on the commercial activity in respect of which assistance was received as specified in sub-paragraph (3), the assets relating to that activity for such period as may be reasonable in the circumstances to allow for disposal of any such asset.

(45) Any mandatory top-up payment made to a person pursuant to section 2 of the Employment and Training Act 1973 in respect of that person’s participation in an employment programme specified in— (a) regulation 75(1)(a)(ii)(aa)(ii) (self-employment route of the Employment Option of the New Deal); (b) regulation 75(1)(a)(ii)(bb) (Voluntary Sector Option of the New Deal); or (c) regulation 75(1)(a)(ii)(cc) (Environment Task Force Option of the New Deal), but only for a period of 52 weeks from the date of receipt of the payment.

(47) In the case of a person who is receiving, or who has received, assistance under an employment programme specified in regulation 75(1)(a)(ii)(aa)(ii) (self-employment route of the Employment Option of the New Deal), any sum of capital which is acquired by that person for the purpose of establishing or carrying on the commercial activity in respect of which such assistance is or was received but only for a period of 52 weeks from the date on which that sum was acquired.

Amendment of the Income Support Regulations

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(23A) Chapters II, III, IV, V, VII and VIIA of this Part and regulations 62 to 66A, 68 and 69 shall not apply to any income which is to be calculated in accordance with Chapter IVA of this Part (participants in the self-employment route of the Employment Option of the New Deal).

(39A) In this Chapter— - “self-employment route" means that part of the Employment Option of the New Deal which is specified in regulation 75(1)(a)(ii)(aa)(ii) of the Jobseeker’s Allowance Regulations 1996; - “special account" means, where a person was carrying on a commercial activity in respect of which assistance is received under the self-employment route, the account into which the gross receipts from that activity were payable during the period in respect of which such assistance was received. (39B) The gross receipts of a commercial activity carried on by a person in respect of which assistance is received under the self-employment route, shall be taken into account in accordance with the following provisions of this Chapter. (39C) (1) The income of a person who has received assistance under the self-employment route shall be calculated by taking into account the whole of the monies in the special account at the end of the last day upon which such assistance was received and deducting from those monies— (a) an amount in respect of income tax calculated in accordance with regulation 39D (deduction in respect of tax for participants in the self-employment route of the Employment Option of the New Deal); and (b) any sum to which paragraph (4) refers. (2) Income calculated pursuant to paragraph (1) shall be apportioned equally over a period which starts on the date the income is treated as paid under paragraph (3) and is equal in length to the period beginning with the day upon which assistance was first received under the self-employment route and ending on the last day upon which such assistance was received. (3) Income calculated pursuant to paragraph (1) shall be treated as paid— (a) in the case where it is due to be paid before the first benefit week in respect of which the participant or his partner first claims income support following the last day upon which assistance was received under the self-employment route, on the day in the week in which it is due to be paid which corresponds to the first day of the benefit week; (b) in any other case, on the first day of the benefit week in which it is due to be paid. (4) This paragraph refers, where applicable in each benefit week in respect of which income calculated pursuant to paragraph (1) is taken into account pursuant to paragraphs (2) and (3), to the sums which would have been disregarded under paragraphs 4 to 6B and 9 of Schedule 8 had the income been earnings. (39D) (1) The amount to be deducted in respect of income tax under regulation 39C(1)(a) (calculation of income of participants in the self-employment route of the Employment Option of the New Deal) in respect of the period determined under regulation 39C(2) shall be calculated as if— (a) the chargeable income is the only income chargeable to tax; (b) the personal reliefs which are applicable to the person receiving assistance under the self-employment route by virtue of sections 257(1), 257A(1) and 259 of the Income and Corporation Taxes Act 1988 (personal reliefs) are allowable against that income; and (c) the rate at which the chargeable income less the personal relief is assessable to income tax is the lower rate of tax or, as the case may be, the lower rate and the basic rate of tax. (2) For the purpose of paragraph (1), the lower rate of tax to be applied and the amount of the personal relief deductible shall, where the period determined under regulation 39C(2) is less than a year, be calculated on a pro rata basis. (3) In this regulation, “chargeable income" means the monies in the special account at the end of the last day upon which assistance was received under the self-employment route.

(64) (1) Subject to sub-paragraph (2), in the case of a person who is receiving, or who has received, assistance under an employment programme specified in regulation 75(1)(a)(ii)(aa)(ii) of the Jobseeker’s Allowance Regulations 1996 (self-employment route of the Employment Option of the New Deal), any payment to the person— (a) to meet expenses wholly and necessarily incurred whilst carrying on the commercial activity; (b) which is used or intended to be used to maintain repayments on a loan taken out by that person for the purpose of establishing or carrying on the commercial activity, in respect of which such assistance is or was received. (2) Sub-paragraph (1) shall apply only in respect of payments which are paid to that person from the special account as defined for the purposes of Chapter IVA of Part V.

Common amendments

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(7) There shall be treated as capital the gross receipts of any commercial activity carried on by a person in respect of which assistance is received under an employment programme specified in regulation 75(1)(a)(ii)(aa)(ii) of the Jobseeker’s Allowance Regulations 1996 (self-employment route of the Employment Option of the New Deal), but only in so far as those receipts were payable into a special account (as defined for the purposes of Chapter IVA of Part VIII of those Regulations) during the period in which that person was receiving such assistance.

Any mandatory top-up payment made to a person pursuant to section 2 of the Employment and Training Act 1973 in respect of that person’s participation in an employment programme specified in— (a) regulation 75(1)(a)(ii)(aa)(ii) of the Jobseeker’s Allowance Regulations 1996 (self-employment route of the Employment Option of the New Deal); (b) regulation 75(1)(a)(ii)(bb) of those Regulations (Voluntary Sector Option of the New Deal); or (c) regulation 75(1)(a)(ii)(cc) of those Regulations (Environment Task Force Option of the New Deal).

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