HMRC v AS
[2023] UKUT 67 (AAC)
Secretary of State for Work and Pensions v LM
20 March 2023
[2023] UKUT 72 (AAC)
Upper Tribunal
Someone got Universal Credit (UC) and was paid every two weeks. The government's calculation of how much UC they got was challenged, but a court found the calculation was done correctly. The earlier court was wrong because it used a legal case about people paid monthly, not every two weeks.
Key Facts
- •LM claimed Universal Credit (UC) and received fortnightly pay.
- •The Secretary of State deducted income received over three separate payments within a single assessment period.
- •The First-tier Tribunal (FtT) ruled the calculation irrational and unlawful, citing *R (Johnson) v Secretary of State for Work and Pensions* and *R (Pantellerisco) v SSWP*.
- •The Secretary of State appealed to the Upper Tribunal (UT).
Legal Principles
Assessment of earned income for UC is based on actual amounts received in the assessment period (one calendar month).
Universal Credit Regulations 2013, Regulation 54(1)
The Court of Appeal in *Johnson* found the UC earned income calculation irrational and unlawful for monthly-paid employees whose pay dates spanned assessment periods.
R (Johnson) v Secretary of State for Work and Pensions [2020] EWCA Civ 778
The Court of Appeal in *Pantellerisco CA* overturned *Pantellerisco HC*, clarifying *Johnson*'s limited application to monthly-paid claimants with specific pay date overlaps, not fortnightly or other payment cycles.
Pantellerisco v Secretary of State for Work and Pensions [2021] EWCA Civ 1454
Outcomes
The Upper Tribunal allowed the Secretary of State's appeal.
The FtT erred in applying *Johnson* to a fortnightly-paid claimant. *Pantellerisco CA* limited *Johnson*'s scope to monthly-paid claimants with specific pay date issues. The Secretary of State's calculation was lawful.
The FtT decision was set aside and remade.
The UT remade the decision, upholding the Secretary of State's original calculation of LM's UC entitlement.