9 September 2020

How are the NHS test and trace self-isolation payments treated for tax credits and universal credit?

The Secretary of State for Health and Social Care recently announced a scheme of payments for people who are in areas with a high incidence of Coronavirus, who need to self-isolate and are unable to work from home and will lose income as a result. Recipients will be those who are on low incomes, receiving certain benefits and they must comply with their official self-isolation obligations. The scheme started on 1 September 2020 and eligibility is currently restricted to certain trial locations.

Local Authorities will be responsible for the administration of applications, payments and disputes associated with NHS test and trace self-isolation payments.

DWP have published ADM memo 20/20, available on the GOV.UK website, confirming that these payments are disregarded for universal credit purposes (indeed, the same is true for housing benefit, see LA Welfare Direct bulletin 9/20 ).

New regulations coming into force on 25 September (SI 2020/941), provide similar treatment for tax credit purposes. The payments are specifically disregarded from income for tax credit purposes.