PippaZ
^Yes, you would pay tax on some working age benefits, if you only received them for part of the tax year and your income increased for the rest of the year. This happens frequently to people who are unemployed for just a couple of months.^
I didn't know that. So it's really only a loan unless you can are out of work for the whole tax year ... could you imagine a few expletives. That does not seem at all right.
That's correct.
Universal Credit is not taxable, but the old Jobseeker's Allowance is/was taxable. Although most newly unemployed people go on to Universal Credit, there are still people claiming the legacy Jobseeker's Allowance. If those people claim for the first part of the tax year, then find a job, tax is calculated on the total income, including the Jobseekers' Allowance and any other taxable benefits.
The most common benefits that you pay Income Tax on are:
- Bereavement Allowance (previously Widow’s pension)
- Carer’s Allowance
- Contribution-based Employment and Support Allowance (ESA)
- Incapacity Benefit (from the 29th week you get it)
- Jobseeker’s Allowance (JSA)
- Pensions paid by the Industrial Death Benefit scheme
- the State Pension
Widowed Parent’s Allowance