Incapacity Benefit and Private Pensions

02/07/2008

Q: I took ill-health retirement in 2002, since when I have been receiving a works pension and Incapacity Benefit. Recently, my Incapacity Benefit has been reduced because of my pension - I have no problem with this. Since April 2004 I have been claiming Council Tax Benefit. But a few months ago my Local Authority re-assessed my Council Tax Benefit and decided that I was not entitled to it, claiming that they should have been assessing my income on the notional/higher amount of Incapacity Benefit (ie. the amount that I would get if I wasn’t receiving a pension) and not the actual rate that I receive

 

They are of course already taking my pension into account. Therefore they have stopped my Council Tax benefit although they have agreed that I do not have to repay the benefit that I have already received. 

I am now working through the system challenging their decision, claiming that they should be using the amount of Incapacity Benefit that I actually receive.

 

 

The Benefits Doctor says:

With Incapacity Benefit, they deduct half of your private pension above £85 per week. So for example, if you have a private pension of £95, they would take £5 off your Incapacity Benefit, so this is correct. But I agree that it doesn’t seem right that the Council Tax Benefit department is taking into account a higher amount of Incapacity Benefit when it is being reduced because of your private pension.

 

I would continue to challenge this decision to take the higher Incapacity Benefit amount into account with the support of your local specialist benefits advice service.