Social Security Benefits and Tax

Which social security benefits are taxable, and which are non taxable?

1st July 2009

www.direct.gov.uk has easy to follow guidelines on what is and what isnít taxable income and/or benefits:

For example, some taxable benefits are:

∑        Some Incapacity Benefit payments - not taxable for the first 28 weeks 
∑        Some Income Support payments - not taxable if you haven't signed on as unemployed and you're looking for work
∑         Jobseeker's Allowance, as discussed above
∑         Statutory Sick Pay
∑         Statutory Maternity Pay
∑         Widowed Parent's Allowance
∑         Employment and Support Allowance - 'contribution' based (if you have paid enough National Insurance contributions) even throughout the assessment phase. www.dwp.gov.uk/esa/pdfs/overview.pdf

 

Non-taxable benefits include:

∑         Back to Work Bonus
∑         Child Benefit
∑         Child Tax Credits
∑         Disability Living Allowance
∑         Maternity Allowance, not to be confused with SMP
∑         Working Tax Credit
∑         Employment and Support Allowance - income based (if you haven't paid enough National Insurance contributions) even throughout the assessment phase.

For a more comprehensive list please click here

By Jo Nockels

Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

Contact us today to make an appointment at your local office

Submit an enquiry