How is income from commercial propery means assessed for Jobseekers allowance?

6digitnumber

I'm in a situation at the moment where I'm receiving nothing from social welfare because my savings (from a redundancy payment) exceed their threshold for jobseekers allowance.

I'm looking at buying a home before all my savings have vanished. I have my eye on an apartment at the moment but it's overhead a small shop, and the shop comes as part of the sale. I'm wondering how ownership of the shop would effect the means assessment?

Would the fact that the shop is part of the same building as your home mean that they shouldn't classify it as a capital investment? After all, selling this 'capital' would also entail selling your home.

I'm not trying to be cute or anything, I would rather the apartment came without the commercial premises as it would probably be a lot less hassle for me.

mp22

Property partly occupied by the claimant.

Any cash income from the portion of a house that is not personally used or enjoyed, is assessable against the claimant as income.
If a portion of the house is being let or is being used for business purposes the following should apply. Deductions from profits should be allowed in respect of ground rent and mortgage interest (not the full amount of the loan repayment) in proportion to the area used for business purposes. If rooms are let furnished, 5% of the gross amount received are allowed for wear and tear and 15% of the gross receipts maybe allowed for voids (i.e. periods when accommodation vacant between lettings).


This might apply,from here http://www.welfare.ie/EN/OperationalGuidelines/Pages/meansassess.aspx#sect1

6digitnumber

Thanks for that, mp22. I'm still a little unsure whether they assess the value of the property that's being rented out, the rent it's generating, or both as means?

If it's the former, then how would they place a value on the shop? The whole buliding is being sold as a single unit for €120,000. If it's the rent it's generating that's taken into account, what formula do they use to calculate it's means? I believe it's being rented out at €400 p/m gross.

mp22

just to confuse the issue further

If you own property (excluding your home) or you have investments or any other form of capital, the value is assessed, using a standard formula (see below) whether or not you are getting an income from the property or investment. If property is rented you will not be assessed on the actual income from the letting. Any outstanding mortgage registered against the property is deducted from the market value to find the capital value.

from here http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/means_test_for_social_welfare_payments/means_test_for_jobseekers_allowance.html

As a guess if the shop part of your building is 50% of the total area, you would be assessed at 60k I think that works out at 110 euro per week means
http://www.welfare.ie/EN/OperationalGuidelines/Pages/meansassess.aspx#sect2
About half way down it states that "Income from property assessed on its capital value" is excluded from the assessment of means

6digitnumber

Thanks again mp22, that's a big help.