Case study 1: Working Family Payment (WFP)
This is an example showing how income is assessed for Working Family Payment (2020 rates) when parenting alone.
Mary has three children. Her youngest two childen are 5 and 7 years old. She is getting a One-Parent Family Payment (OFP) and was recently offered work part-time. If she takes the job, she will work three days each week and earn €300. Mary wants to take the job as all of her children are now in school but she knows her One-Parent Family Payment will be affected.
Would Mary be better off financially if she takes the job offer? She has
lived in her home for 20 years and has a small mortgage. She gets a weekly
maintenance payment of €80 for her mortgage costs which does not affect her
One-Parent Family Payment. Her 18-year-old daughter is a student and has a
part-time job in a local shop.
Weekly net income from employment (See note 1) €300
Add Weekly net income from self-employment €0
Add reduced OFP (See note 2) €255
Add Income from occupational pensions €0
Add Maintenance received €80
Total income €635
The Working Family Payment (WFP) maximum income limit for a family with three children is €733. The difference between €733 and €635 is €98. 60% of the difference (€98) is €58.80
Mary will get a WFP rate of €58.80 each week.
Her current income is €395 (€315 OFP payment for herself and 3 children plus €80 maintenance).
If she takes the job, her total gross income including WFP will be €693.80 (€255 OFP plus €58.80 WFP plus €300 income from work plus €80 from maintenance).
Mary’s net income from employment is assessed for WFP, however her daughter’s income is not assessed because she is under 22 years of age and in full-time education.
If Mary gets €300 from employment, her One-Parent Family Payment will be reduced. (€165 of income from employment is disregarded and 50% of the remaining €135 - which is €67.50 - is assessed as means). A person with means of €67.50 gets an OFP payment of €143. She gets €36 for each child under 12 and €40 for her child 12 and over. So her total payment will be €255 (€143 + €72 + €40 = €255).