Martin Lewis on carer's allowance and the effect on pensions
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Carer’s Allowance is the most common benefit an unpaid carer can get however other benefits can be impacted if a person decides to claim. The payment equates to an extra £3,600 every year to help with living the carer’s living costs. If a person claims the state pension, contributory Employment and Support Allowance (ESA), contribution-based Jobseekers Allowance (JSA) or Maternity Allowance then the amount of Carer’s Allowance can be reduced or stopped.
If a person’s Carer’s Allowance is either the same as or less than the other benefit, people will get the other benefit rather than Carer’s Allowance.
If the other benefit is less than what a person gets for Carer’s Allowance, then they will get the other benefit instead.
However, they will receive a balance of the Carer’s Allowance on top.
Claiming could also lead to a person receiving a severe Disability Premium paid with their benefits or an extra amount of severe disability paid with Pension Credit to be cut.
If the person who is being cared for claims severe Disability Premium then this payment of £69.40 a week could be stopped when Carer’s Allowance has been claimed.
However, it’s important to note that applying for Carer’s Allowance could mean the person being cared for stops receiving help towards council tax.
The Government website states: “When you claim Carer’s Allowance your other benefit payments may change, but your total benefit payments will usually either go up or stay the same.”
The Government website also highlights that the support “does not count” towards the benefit cap.
The website adds: “If you get Working Tax Credit or Child Tax Credit, you must contact HM Revenue and Customs (HMRC) to tell them about your Carer’s Allowance claim.
“If you get Pension Credit, your payments will increase if you’re eligible for Carer’s Allowance.”
In regards to the state pension, there is no upper age limit for claiming Carer’s Allowance although people cannot receive the full amount of both Carer’s Allowance and a state pension at the same time.
Once again, if a person’s state pension is below the Carer’s Allowance amount then the Government will top it up to equal it.
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The Government recommends that people use their benefits calculator to work out how their other benefits could be affected by claiming Carer’s Allowance.
In order to be eligible, people must be caring for someone else for at least 35 hours a week, be over the age of 16 years and not earn more than £132 a week from employment or self-employment.
This is after deductions for income tax, National Insurance and for pensions.
Under the rules, caring for someone includes tasks such as helping with washing and cooking, taking the person being cared for to a doctor’s appointment or helping with household tasks, like managing bills and shopping.
People may be eligible if they, the person they care for and the type of care they provide meets certain criteria.
The person being cared for must also be claiming at least one of the “qualifying benefits”.
These include Personal Independence Payment (PIP), Disability Living Allowance, Attendance Allowance, and Disablement Benefit, Armed Forces Independence Payment or Child/Adult Disability Payment.
It is reiterated that people do not have to be related to, or live with, the person they care for.
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