Any income you receive from voluntary sources - such as from friends and family or from charities - is disregarded completely when calculating benefits. This means the amount of benefit you are entitled to is not affected by this kind of income.
If you receive regular income from friends and family, or from charities, you do not need to enter anything under this source of income. Most other sorts of income should be entered into the calculator.
Note: that maintenance payments from a former partner or parent of a child are not treated as voluntary payments. You should enter income from these sources elsewhere in the calculator.
If you receive irregular income from friends and family, or from charities, then you should enter the amount you have received under 'savings'. In general you do not need to declare any savings unless your total savings are over £6,000 or £10,000 if you or your partner are over pension age.
Regular payments include those paid or due to be paid at recurring intervals such as weekly, monthly or annually (for example every Christmas).
Regular gifts in kind, for example, Christmas hampers are ignored. Irregular gifts in kind from a charity are also ignored but from any other source they are treated as savings.
Please note that if you are in a trade dispute different rules apply.
What are charitable and voluntary payments?
A charitable payment is a payment made under a charitable trust at the discretion of the trustees. A charitable trust must be wholly and exclusively charitable and promote a public benefit. Charitable trusts usually provide for the relief of poverty, advancement of education , advancement of religion, or for other purposes which benefit the community
A voluntary payment is a payment that has a benevolent purpose and is given without anything being given in return. A voluntary payment is similar to a charitable payment but it will not usually be made from a charitable trust.
When deciding if the payment is a voluntary payment the govenment will consider the background to the payment, and reasons for it.
Example 1: Jim declares that he gets a payment of £20 a week from his Uncle Peter, towards the cost of running his car. Peter makes the payment because Jim has been receiving benefit for some time and needs a car to get around. Peter makes the payment because of family ties and affection for Jim. Peter does not expect or receive anything in return. The assessing officer decides that the £20 is a voluntary payment.
Example 2 : Frances is retired and receives a payment of £4.50 a week from her former employer in addition to her occupational pension. This payment is made to all former employees who worked for the company for over 20 years. The payments were awarded by the board of directors following criticism by shareholders of the treatment of former employees with long service. The assessing officer decides the payment is not voluntary because the directors of the company are receiving in return for the payment greater satisfaction from the shareholders, the company's image is improved and payments are not made specifically to help needy employees but are made to all former employees, regardless of need
As an expert in social welfare and income calculation, I can assure you that understanding the nuances of income sources and their impact on benefit calculations is crucial. The information provided in the passage is related to the treatment of income from voluntary sources, such as payments from friends and family or charitable organizations, in the context of calculating entitlement to benefits.
Let's break down the concepts used in the passage:
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Voluntary Sources and Benefit Calculation:
- The passage emphasizes that income from voluntary sources, like friends, family, or charities, is disregarded when calculating benefits. This means that such income does not affect the amount of benefits an individual is entitled to receive.
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Regular and Irregular Income:
- Regular income from friends, family, or charities, whether paid weekly, monthly, or annually, is exempt from benefit calculations. Irregular income from these sources should be declared under 'savings.'
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Maintenance Payments:
- Payments from a former partner or parent for the support of a child are not considered voluntary and should be entered separately in the benefit calculator.
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Savings Threshold:
- There's a threshold for savings – generally, savings under £6,000 are not required to be declared. This threshold increases to £10,000 for individuals or partners over pension age.
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Gifts in Kind:
- Regular gifts in kind, like Christmas hampers, are ignored. Irregular gifts in kind from a charity are also ignored, but if they come from other sources, they are treated as savings.
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Charitable and Voluntary Payments:
- The passage distinguishes between charitable and voluntary payments. Charitable payments are made under a charitable trust for the public benefit, while voluntary payments are benevolent and given without expectation of anything in return.
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Determining Voluntary Payments:
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The government considers the background and reasons for a payment to determine if it's voluntary. The examples illustrate scenarios where a payment is deemed voluntary or not.
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Example 1: Uncle Peter's payment to Jim is considered voluntary because it stems from family ties and affection without any expectation of return.
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Example 2: Frances' payment from her former employer is not deemed voluntary because it is linked to the company's image and shareholder satisfaction, rather than a specific need for the recipients.
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Understanding these concepts is vital for individuals navigating the welfare system to ensure accurate benefit calculations and compliance with rules regarding income declaration.
