Fife man on Universal Credit ‘paying higher rate of tax than a millionaire’

Stuart Thomson from Glenrothes regularly sees his benefit cut simply because he is paid every four weeks rather than every month.

He works as a part time dementia patient companion,and says he can’t afford to work additional hours because of the Universal Credit “taper rate” – a rule that means he loses 55p in benefit for every additional pound he earns.

Now his MP, Peter Grant, has taken up his case.

The SNP member hit out: “Although the Government won’t admit it, the fact is that many disabled workers such as Mr Thomson are effectively being taxed at a higher rate than the millionaires who fund the Tory Party.”

Mr Thomson described the system as “degrading” adding: “It assumes that people do not want to work and forces people to agree to claimant commitments that are plain silly.

“My main problem with Universal Credit is regarding the taper rate. It keeps me poor by reducing any earned income by 55%.

“Where is the incentive to work more hours when all that I am allowed to keep from £10.50 per hour is just £4.72?

“If Universal Credit is really about making work pay, then do not tax my limited earnings until I have at least used up my personal allowance - limited earnings plus total benefits - and then tax me at 19% just like every other citizen in the UK.

“Why should a disabled worker, or any other worker, pay 55% when even the highest earners in the UK only pay 45% tax on earnings after deducting their personal allowance?”

Mr Thomson also explained that because he gets paid every four weeks rather than every calendar month he sometimes has two paydays in the same month – and the Universal Credit system treats this as if he is earning twice as much as his actual salary.

He said he lost £293 in April due to a "double payment" in the same assessment period.

Mr Thomson is one of many constituents who have contacted Mr Grant for support navigating the benefits system.

The MP said: “The Tory Government is always keen to argue that work is the best way out of poverty, but with in-work poverty reaching an all-time high this year the UK Government’s own policies are preventing my constituents from working overtime, and even penalising them for being paid every four weeks rather than once a month.

“One of that Government’s flagship policies was the introduction of Universal Credit which they still claim aims to ‘make work pay’, but the system is so flawed that I have constituents who literally can’t afford to take on extra hours at work as it would leave them worse off.

“Although the Government won’t admit it, the fact is that many disabled workers such as Mr Thomson are effectively being taxed at a higher rate than the millionaires who fund the Tory Party.”

Mr Grant, who has contacted Government officials on behalf of Mr Thomson.