Carers hit by abolition of 10p tax rate

Gavin Macgregor, Head of Communications and Development at Carers UK said :

“Many carers can only manage their caring responsibilities by working part-time or in low paid jobs. Carers contribute so much to society yet these tax changes will leave some worse off. Government will shortly be publishing a new National Strategy for Carers and it should use this opportunity to help those carers made worse off as a result of last year’s budget”.

Losers from the tax changes include people earning between £5,435 and £19,355 a year. Many carers are forced to work part-time, both to manage their caring responsibilities and to remain under the earnings limit for Carer’s Allowance. The maximum earnings a carer can have and still claim Carer’s Allowance is £95. This is equivalent to 17 hours at the minimum wage (£5.52). Carers aren’t eligible for working tax credits unless they are working for more than 30 hours per week.

Carers UK research in 2007 showed carers were retiring on average 8 years early. This group could also lose out because they are not eligible for tax credits, but are too young to benefit from the increase in the tax allowance for those aged 65 and over.

A solution would be to make carers eligible for tax credits if they work for 16 hours each week, as lone parents and disabled people currently are. Carers UK has recommended this to Government.

Carers UK believes that the current benefits system doesn’t work for carers and our campaign ‘Real Change not Short Change’ has been calling for a radical overhaul of carers’ benefits.

Ends 22.04.08

Notes to editors:

Carers UK’s Real Change not Short Change campaign is calling on the government to take a fresh look at benefits for carers that will :

• Help carers work Having to give up work is a direct cause of carer poverty. Carers lose income and through loss of pensions are storing up future poverty.
• Help carers who are unable to work For some carers work is not an option. The level of skill and care they provide simply cannot be replaced.
• Help older carers enjoy a decent retirement Carers lose their Carers Allowance when they reach retirement as the benefit is seen simply as an income replacement. Yet they continue to provide care with little or no recognition.

Find out about Carers UK's Real Change not Short Change campaign more...