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DDI2.5 XML CODEBOOK RECORD FOR STUDY NUMBER 8856 Effects of Taxes and Benefits on Household Income, 1977-2024 885610.5255/UKDA-SN-8856-4 Office for National Statistics <a href="https://www.nationalarchives.gov.uk/information-management/re-using-public-sector-information/uk-government-licensing-framework/crown-copyright/" target="_blank">© Crown copyright</a>. The use of these data is subject to the <a href="https://ukdataservice.ac.uk/app/uploads/cd137-enduserlicence.pdf" target="_blank">UK Data Service End User Licence Agreement</a>. Additional restrictions may also apply. Office for National Statistics UK Data Service 02 November 2021 ADULTSALCOHOLIC DRINKSCHILDRENEDUCATIONAL GRANTSEXPENDITUREFRINGE BENEFITSFOSSIL FUELSFURTHER EDUCATIONHOUSEHOLD BUDGETSHOUSEHOLDSIMPORT TAXESINCOMEINCOME TAXINVESTMENT RETURNLOTTERIESOCCUPATIONAL PENSIONSPRIMARY EDUCATIONPRIVATE PERSONAL PENSIONSRETIREMENTSECONDARY EDUCATIONSELF-EMPLOYEDSOCIAL SECURITY BENEFITSSOCIAL SECURITY CONTRIBUTIONSSTATE RETIREMENT PENSIONSSTUDENTSSUBSIDIESTAXATIONTRAVELUNEARNED INCOMEUNEMPLOYMENT BENEFITSWAGESCONSUMPTION TAXWATER RATESSICKNESS AND DISABILITY BENEFITSCARERS' BENEFITSEMPLOYMENT PROGRAMMESTAX RELIEFSURVIVORS' BENEFITSHOUSING BENEFITSPRIVATE EDUCATIONROAD TAXPENSION BENEFITSFREE SCHOOL MEALS Income, property and investment/saving Abstract copyright UK Data Service and data collection copyright owner. This analysis, produced by the Office for National Statistics (ONS), examines how taxes and benefits redistribute income between various groups of households in the United Kingdom. It shows where different types of households and individuals are in the income distribution and looks at the changing levels of income inequality over time. The main sources of data for this study are: <ul> <li>Family Expenditure Survey (FES) from 1977-2001</li><li>Expenditure and Food Survey (EFS) from 2001-2007</li><li>Living Costs and Food Survey (LCF) from 2008 to 2017</li><li>Household Finances Survey (HFS) from 2018 onwards </li></ul> Some variables have been created by combining data from the LCF (previously FES or EFS) with control totals from a variety of different government sources, including: <ul> <li>United Kingdom National Accounts (ONS Blue Book)</li><li>HM Revenue and Customs (HMRC)</li><li>Department for Transport (DfT)</li><li>Department of Health (DH)</li><li>Department for Education and Employment (DfEE)</li><li>Department for Communities and Local Government (DCLG)</li></ul> For further information, see the ONS <a href="https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/theeffectsoftaxesandbenefitsonhouseholdincome/previousReleases" title="Effects of taxes and benefits on household income" target="_blank">Effects of taxes and benefits on household income</a> webpage.Users should note that the combined ETB household (1977-2021) and person (2018-2021) datasets replace all previous individual year files, which have been withdrawn from use at the depositor's request.  Latest edition informationFor the fourth edition (December 2025), replacement data and documentation for 2022 and 2023, and new data/documentation for 2024 were added to the study. Method of Data CollectionThe ETB has been produced each year since 1961 and is an annual analysis looking at how taxes and benefits affect the income of households in the UK. Since 2018, the estimates in this analysis are based on data derived from the HFS Survey (the HCF is not currently held by the UK Data Service). The HFS is an annual survey of the expenditure and income of private households. People living in hotels, lodging houses, and in institutions such as old people's homes are excluded. Each person aged 16 and over keeps a full record of payments made during 14 consecutive days and answers questions about hire purchase and other payments; children aged 7 to 15 keep a simplified diary. The respondents also give detailed information, where appropriate, about income (including cash benefits received from the state) and payments of Income Tax. Information on age, occupation, education received, family composition and housing tenure is also obtained. The survey is continuous, interviews being spread evenly over the year to ensure that seasonal effects are covered. The Family Spending publication also includes an outline of the survey design. The HFS data used in this analysis are grossed so that totals reflect the total population of private households in the UK. The weights are produced in two stages. First, the data are weighted to compensate for non-response (sample-based weighting). The non-response weights are then calibrated so that weighted totals match population totals for males and females in different age groups and for different regions and countries (population-based weighting). The results in the analysis are weighted so that statistics represent the total population in private households in the UK based on 2011 Census data. In 2013/14, an additional calibration to the Labour Force Survey (LFS) employment totals was also applied. There are a number of different measures of income used, the most common of which is probably household disposable income. This is the total income households receive from employment (including self-employment), income from private pensions, investments and other sources, plus cash benefits (including the state pension), minus direct taxes (including income tax, NI and council tax). Income is normally analysed at the household level as this provides a better measure of people's economic well-being; while income is usually received by individuals, it is normally shared with other household members (e.g. spouse/partner and children). In 2018/19 a further adjustment was applied to the data to adjust for the under coverage and under-reporting of income of the richest individuals. This method is often referred to as the 'SPI adjustment' owing to its use of HM Revenue and Customs (HMRC's) Survey of Personal Incomes (SPI). For further details please see the ETB <a title="Quality and Methodology Information" href="https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/methodologies/theeffectsoftaxesandbenefitsonukhouseholdincome">Quality and Methodology Information</a> webpage and the <a title="Effects of Taxes and Benefits on Household Income Technical Report" href="https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/articles/theeffectsoftaxesandbenefitsonhouseholdincome/financialyearending2019">Effects of Taxes and Benefits on Household Income Technical Report</a>. Data Sources The Household Finances Survey (HFS) is the source of the microdata on households from 2018 onwards. Previously, the Living Costs and Food Survey (LCF) was the data source. Derived variables are created using information from HFS and control totals from a variety of different government sources including the United Kingdom National Accounts (ONS Blue Book), HM Revenue and Customs, Department for Transport, Department of Health, Department for Education and Employment, and Department for Communities and Local Government. Secure Access version A Secure Access version of the ETB is available from the UK Data Archive under <a href="https://beta.ukdataservice.ac.uk/datacatalogue/studies/study?id=8253" target="_blank">SN 8253</a>, subject to stringent access conditions. The Secure Access version includes variables that are not included in the standard End User Licence (EUL) version, including case number, age and economic position of chief economic supporter, and government office region. Users are strongly advised to check whether the EUL version is sufficient for their needs before considering an application for the Secure Access version. Main Topics: The analysis considers the distribution of household income using five income measures in order to assess the effect of government intervention. The five income measures are: <ul> <li>original income: includes income from employment, self-employment, investment income, occupational pensions and annuities</li><li>gross income: original income plus cash benefits</li><li>disposable income: gross income minus direct taxes (income tax, employees' National Insurance contributions and local taxes)</li><li>post-tax income: disposable income minus indirect taxes</li><li>final income: post-tax income plus benefits in kind (from education, the national health system, travel and housing subsidies).</li></ul> Standard measures: Historically, the equivalence scale used in this analysis was the McClements scale (before housing costs are deducted). To allow for better comparability with other sources, this analysis adopted the modified-OECD scale for the 2009/10 article. The modified-OECD scale usually assigns a weight of 1.0 for the first adult in a household, 0.5 for each additional adult and a weight of 0.3 for each child (defined as those under 14 years old). However, in this analysis the modified-OECD scale has been rescaled so that a two adult household equivalence value is 1.0. This makes it easier to compare with data that uses the McClements equivalence scale without making any difference to the overall results. The values for each household member are added together to give the total equivalence number for that household. This number is then used to divide disposable income for that household to give equivalised disposable income. United Kingdom IndividualsFamilies/householdsNational Private households in the United Kingdom: A household comprises one person living alone or a group of people (not necessarily related) living at the same address who a) share cooking facilities; b) share a living room or sitting room or dining area. Resident domestic servants are included. The members of a household are not necessarily related by blood or marriage. As the survey covers only private households, people living in hostels, hotels, boarding houses or institutions are excluded. Households are included if some or all members are not British subjects, however, information is not collected from households containing members of the diplomatic service of another country or members of the United States armed forces. Numeric Time Series Multi-stage stratified random sample Compilation/Synthesis The Data Collection is available to UK Data Service registered users subject to the <a href="https://ukdataservice.ac.uk/app/uploads/cd137-enduserlicence.pdf" target="_blank">End User Licence Agreement</a>.Commercial use of the data requires approval from the data owner or their nominee. The UK Data Service will contact you. See <restrctn> https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/theeffectsoftaxesandbenefitsonhouseholdincome/previousReleases https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/datasets/theeffectsoftaxesandbenefitsonhouseholdincomefinancialyearending2014 https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/methodologies/theeffectsoftaxesandbenefitsonukhouseholdincome https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/theeffectsoftaxesandbenefitsonhouseholdincome/2024 https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/methodologies/theeffectsoftaxesandbenefitsonukhouseholdincome https://oai.ukdataservice.ac.uk:8443/oai/provider 8856 2025-12-03T06:31:28Z ddi:codebook:2_5