The Carer's Allowance weekly earnings limit was increased earlier this week to £123; but what problems does this create for working parents with disabled children?
The Carer's Allowance is the main benefit that carers can receive, so long as your earnings do not exceed the weekly earnings limit which is now set at £123 (after deductions).
While this may initially sounds like good news for carers in low paid or part-time work, many of those who receive the National Living Wage (NLW) will not benefit at all - quite the opposite in fact.
And here's why...
The NLW has just increased to £8.21 per hour, which means that if you currently benefit from Carer's Allowance and work 16 hours per week, your earnings will be above the maximum threshold at £131.36 per week and you will no longer be able to claim Carer's Allowance.
This creates a larger problem because it's not a simple fix to just decrease your weekly working hours. Even if your employer was happy for you to drop your hours, the implications that arise from working less than 16 hours per week are that some other benefits for working parents are affected, such as working tax credits and access to 15 hours of free childcare if you have a 3 or 4 year old.
Parents who are already juggling part-time work alongside caring for their disabled child now face a no win situation by having to choose between losing their Carer's Allowance or Working Tax Credits. A huge injustice and a massive oversight.
Is there a solution?
If the weekly earnings limit fell in-line with the National Living Wage... well, that would have made more sense. However, we can't hold our breath waiting for that to happen.
Certain costs can be lawfully deducted from your earnings, meaning you could still qualify for Carer's Allowance without having to decrease your working hours, if those deductions took your earnings below the £123 limit. Ways that you can do this include:
Pay for some else (other than a close family member) to look after your disabled child(ren) whilst you are at work. But beware, there is a cap on the maximum amount of hours that can be deducted for care costs which means you cannot deduct more than half of your earnings from your earnings limit.
Place half of any contributions that you make into a workplace or personal pension scheme.
If you need any further advise or guidance regarding your rights as a carer, Ann's Guiding Hand are here to help you! With my extensive background in caring for disabled children and young people, I can assist you in finding the right part-time care and support to suit your families needs.
Please contact me today to find out more!