Recommendation 11

We are glad the Government accepted our recommendation to consider carefully the implications of the Remedial Order for taxation, tax credits and Universal Credit, ensuring that those who receive retrospective payments as a result of the Remedial Order are not disadvantaged. We welcome the confirmation that retrospective Widowed Parent’s Allowance payments will be treated as capital and disregarded for 12 months, and will not count towards the Benefit Cap. In the same spirit, we are confident the Government will reflect on the way in which deprivation of capital provisions are applied to recipients of retrospective lump sum payments, and the treatment of those payments for the purposes of tax credits.