Commentary on Sections Sections 11 to 14: Miscellaneous and supplementary Section 15: Income and capital
124.In section 15,subsection (1) defines income for the purposes of the Act.
	Paragraph (e) includes a regulation-making power which enables the Secretary of State to prescribe those social security benefits that are taken into account in the assessment.
	Paragraph (f) enables further regulations to prescribe the foreign social security benefits that are to count as income. The intention is that this will include any social security benefit paid by the government of a country outside the United Kingdom that is analogous to any of those prescribed under paragraph (e).
	Paragraph (g) brings in war disablement pensions and war widow's or widower's pensions (see the definitions of these terms in section 17(1)), while paragraph (h) brings in their foreign equivalents, paid by governments of countries outside the United Kingdom (again, see the corresponding definitions of these expressions in section 17(1)).
	Paragraph (j) enables regulations to be made bringing in other descriptions of income. It is intended that this power will be used to cover income streams which few pensioners have, such as employers' sick pay or matrimonial maintenance payments. In the future, the power might be exercised to bring new types of income into account.
125.Subsection (2) confers power to make regulations prescribing how capital holdings will be taken into account in calculating Pension Credit. Normally, capital will be deemed to have an assumed rate of return for purposes of assessing entitlement to the guarantee credit and savings credit.  The intention is that a rate of return of £1 a week for every £500 will be applied to capital in excess of £6,000 (£10,000 in cases of people in residential care and nursing homes). Capital below this amount will not be treated as giving rise to income which is to be taken into account in the assessment. Certain types of actual income from capital will be relevant to the assessment. These are limited to income from boarders and sub-tenants in the person’s own home and income from certain trusts. Here, there will be different provision as to disregarding income, which will follow the existing provision for Income Support.
126.Subsections (3) and (4) provide regulation-making powers to prescribe how income and capital will be assessed.  The subsections provide that income accrued during any period will be calculated in line with prescribed rules.   It is intended that the rules will provide that income may be averaged (seesubsection (5)).  In averaging income for fluctuating earnings, for example, the Secretary of State may take an average for a past and current period and apply it to a future period.
127.Subsection (6) confers the power to make regulations prescribing how income and capital will be treated in certain situations. It is intended that Pension Credit will also have the limited income and capital disregards that currently apply in Income Support.
128.It is also intended that existing provisions in the Income Support (General) Regulations 1987 concerning unacceptable deprivation of income or capital will be applied to Pension Credit with amendments. These will contain provisions which state what is unacceptable deprivation, for example gifts to third parties, and what is not, for example, a claimant repaying a mortgage on their home. Thus, for example, a claimant may be treated as having a notional income from capital no longer in their possession if they have disposed of the capital solely or mainly to secure or increase entitlement to Pension Credit.