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UC counts royalties, trust income and overseas pensions in miscellaneous_income as earned income #1961
Description
Problem
UC treats all of miscellaneous_income as earned income. uc_mif_capped_earned_income adds it, so it is tapered at 55% and can take the work allowance.
The policyengine-uk-data build (datasets/frs.py, MISC_INCOME_FIELDS plus odd jobs) fills it from these FRS fields. Labels are from the FRS 2024-25 UKDA data dictionary:
| FRS field | Label | UC treatment in law |
|---|---|---|
| ROYYR2 | "Amount of royalties" | ITTOIA 2005 Part 5 Ch 2: unearned income under reg 66(1)(m), unless the royalties are profits of a trade or profession |
| ROYYR3 | "Amount of income as sleeping partner" | A partner's share of trading profits is self-employed earnings (regs 52(a)(ii), 57). Earned, but through the self-employment rules. |
| ROYYR4 | "Amount of overseas pension" | Retirement pension income (reg 66(1)(a); SPCA 2002 s.16(1)(g) "income from an overseas arrangement") or a foreign state retirement pension (reg 66(1)(da)): unearned |
| CHAMTTST | "Income received from a Trust" | Income from a trust: unearned under reg 66(1)(j), unless disregarded under reg 75 or 76 |
| CHAMTERN | "Earnings received from spare time job" | Earned (reg 52(a)(iii) "any other paid work") |
| OJAMT (odd jobs) | "Amount received from odd job" | Earned |
| ALLPAY2 | "Amount of allowance: organisation" | Depends on the payer. Not classified here. |
Royalties, overseas pensions and trust income should be deducted in full as unearned income. The model instead tapers them at 55% as earnings.
Fix
Split miscellaneous_income into its legal categories at the data build, or add separate input variables:
- put royalties, overseas pensions and trust income on the UC unearned list (
gov.dwp.universal_credit.means_test.income_definitions.unearned); - leave spare-time and odd-job earnings in earned income.
Verify each classification verbatim against UC Regs 2013 regs 52, 66 and 67 and SPCA 2002 s.16 before changing anything. Add hand-computed tests and real Enhanced FRS runs.
Found in review of #1950, which drops interest, dividends and rent from UC unearned income and does not touch miscellaneous_income.
🤖 Generated with Claude Code
Activity
Keep a miscellaneous loss out of total income and UC earnings too
Merge origin/main (6d89338) into the #1986 fix
Pin miscellaneous income as earned for both the award and the cap (#1961