Exact amount you can earn on Carer’s Allowance before having payments STOPPED

CARER’S should be aware of the exact amount they can earn before having their payments stopped.

A person can apply for the government benefit if they are giving regular care to someone who is disabled or unwell.

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To qualify for the allowance you must spend at least 35 hours a week looking after the vulnerable person.

You can receive up to £81.90 per week from the government and you do not need to be related or live with the person you are caring for.

But the Department of Work and Pensions (DWP) has a cut off point for how much carers can earn from a second income while also claiming the benefit.

Currently, it stands at £151 per week, if you go over this amount you could risk losing all your benefit.

The figure was previously £139 but it was increased in April 2024 to £151.

Benefits and tax thresholds tend to change every April in line with the new tax year.

This is different to other benefits, like Universal Credit, which has a tapered approach to earnings so that those who do work don’t lose all of their money at once.

It also important to note that the DWP looks to get any overpaid benefits back.

However, in some cases, the government department doesn’t flag earnings limit breaches for several years, which sees people overpaid massive sums which have to be repaid.

If you don’t engage with the repayment process, you can even be taken to county court.

During 2022-23, some 26,700 carers were asked to repay sums relating to earnings breaches.

More than 800 were repaying sums between £5,000 and £20,000, and 36 were repaying more than £20,000

There’s no time limit on how far back the DWP can go to spot erroneous carer’s allowance payments and demand money back.

George Henderson, 64, from Leyland in Lancashire owed the DWP £20,000 due to a mistake he made when first applying for the benefit.

He applied for carer’s allowance while he was looking after his 42-year-old son John, who has learning difficulties and is a heroin addict, The Guardian reported back in April.

He wrongly ticked a box saying he was unemployed, when in fact he was earning £7.50 an hour as a self-employed taxi driver.

The outcome of this mistake was catastrophic for the father and he ended up being convicted of fraud and losing his home.

It comes as a recent DWP Family Resource Survey (FRS) found 21% of households with an adult carer was living on less than the average UK income.

And 5% of those receiving Carer’s Allowance had used a food bank in the last 30 days, compared to only 1% of the wider population.

What to do if you breach the earnings limit

If you breach the £151 earnings limit, you should try and proactively report it to the DWP as it is classed as a change in circumstances.

You can report any change in circumstances online via the Government’s website.

But you’ll need your National Insurance (NI) number to hand, details of the person you’re caring for and details of the change.

If you have been overpaid Carer’s Allowance, you will have to pay it back in full or instalments via the DWP Debt Management platform.

This is also on the Government’s website.

If you don’t do this, the DWP can take deductions from your work salary, or even pass your case on to a debt collector.

If you don’t engage with the debt collector, it may then take your case to the county courts.

You can dispute an overpayment if you don’t agree with it, but you’ll need evidence as to why you claim to not have overpaid.

You can do this via what’s known as a “mandatory reconsideration”, which you can submit to the DWP online, via phone or by letter.

The specific contact details you’ll need to send any correspondence to will be on the decision letter you receive from the DWP.

Once the DWP has received your mandatory reconsideration, you will receive a “mandatory reconsideration notice” informing you whether it has changed its decision.

If you disagree with that outcome, you can appeal to the Social Security and Child Support Tribunal.

A judge will listen to both sides of the argument before making a decision.

Can you apply for Carers Allowance?

To be eligible for carers allowance you must be aged 16 or over and not be in full time education.

You also must not be earning over £151 a week from employment or self-employment after tax deductions.

Carers will also not be paid more if they look after more than one person.

If you qualify for the benefit you can choose to be paid weekly in advance or every 4 weeks.

You can apply for the carer’s allowance online by visiting www.gov.uk/carers-allowance/how-to-claim.

You can also request a form by calling the Carer’s Allowance Unit on 0800 731 0297.

Processing time usually takes up to 12 weeks to get a decision on your claim.

Carer’s Allowance can be backdated for up to 3 months if you were eligible during that time.

If your state pension is less than the Carer’s Allowance amount of £81.90, you can claim Carer’s Allowance to top it up to that level.

But if your state pension is more than £81.90, you won’t receive any of the benefit.

This is because the State Pension and Carers Allowance are classed as ‘overlapping’ benefits, which can’t be paid at the same time.

If the government recognises that you are struggling financially as a carer on a pension you can get extra money on other benefits you claim such as Housing Benefit.

It is always worth speaking to your local council to see other support funds available.