﻿ 7.9.3 Formulated rate table | Compensation and Support Reference Library, Overpayment Management Manual, Ch 7 Recovery and Other Methods of Finalising Debts , 7.9 Limitations

# 7.9.3 Formulated rate table

Page

7.9.3.1The table below sets out the steps for determining the 'formulated rate' of recovery.

 Step Action 1 Calculate the total income from all sources. Write the total income at (a) (a) 2 Is the amount at (a) greater than the maximum basic rate (MBR)?If yes, write the MBR at (b)If no, copy (a) to (b) (b) 3 Multiply (b) by 14% and write the amount at (c) (c) 4 Is the amount at (a) less than the MBR?If yes, write \$0 to (d)If no, subtract the MBR from (a), and write the amount to (d) (d) 5 Is the amount at (d) greater than the income free area (IFA)?If yes, copy the IFA to (e)If no, copy (d) to (e) (e) 6 Multiply (e) by 55%and write the amount at (f) (f) 7 Is the amount at (d) less than the IFA?If yes, write \$0 to (g)If no, subtract the IFA from (d), and write the amount to (g) (g) 8 Multiply (g) by 27.5% and write the amount at (h) (h) 9 Add up the amounts at (c), (f) and (h) to determine the formulated rate.

7.9.3.2Income used in the formulated rate includes:

• all items defined in the CLIK Policy Library – P10/C1 Ordinary Income

This excludes 'deprived income' and 'deemed income' as per this manual's Section 7.9.2.4  Where deemed income on financial assets are excluded, any actual income earned derived or received should be taken into account
• service pension or income support supplement
• basic rate of disability compensation payment
• war widow(er)'s pension, including the non-indexed amount and pension supplement