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Notional capital and welfare benefit

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Comments

  • rogerblack
    rogerblack Posts: 9,446 Forumite
    Hello,
    My friend has been summoned to answer charges that he has knowingly got rid of notional capital in order to gain welfare benefit.

    The key is 'knowingly'.
    Can it be reasonably argued that the friend did not know of the deprivation of capital rules?
    http://www.dwp.gov.uk/docs/dmgch52.pdf - capital rules - for ESA - though they are all identical I think.

    See 52825.
    If they gave back a large sum of money that they were free to use in any manner, knowing it would mean they would be entitled to benefit, then they have knowingly deprived themselves of capital, and the notional capital rules apply meaning they are not eligable for benefit.

    If they did not know, then in theory this is a defence - but proving this will be hard.
    It may be easier to argue if they've never been on benefit, and had little knowledge of the system, or if the money was borrowed specifically for household alterations with some agreement signed with the lender.
    Or indeed if the lender was pressing for repayment of the loan.
  • NASA_2
    NASA_2 Posts: 5,571 Forumite
    It sounds like a hastily thought up excuse.
  • 33degrees
    33degrees Posts: 27 Forumite
    rogerblack wrote: »
    The key is 'knowingly'.
    Can it be reasonably argued that the friend did not know of the deprivation of capital rules?
    http://www.dwp.gov.uk/docs/dmgch52.pdf - capital rules - for ESA - though they are all identical I think.

    See 52825.
    If they gave back a large sum of money that they were free to use in any manner, knowing it would mean they would be entitled to benefit, then they have knowingly deprived themselves of capital, and the notional capital rules apply meaning they are not eligable for benefit.

    If they did not know, then in theory this is a defence - but proving this will be hard.
    It may be easier to argue if they've never been on benefit, and had little knowledge of the system, or if the money was borrowed specifically for household alterations with some agreement signed with the lender.
    Or indeed if the lender was pressing for repayment of the loan.

    It sounds like the person in question was gifted £38,000 by an individual which then became a verbal loan.Further to your comments re silver in a locked thread yesterday, when the euro implodes, which it will, as planned, before August 1, then the US dollar will fall soon afterwards, and as all the fiat out there are derivatives of the world's reserve currency then welcome to Weimar Britain too. Anyone who's informed that sells their silver or gold insurance at this time will deserve their place amongst a very long queue for free soup.
  • heres what we did last year and what we were told by dwp

    we took out a secured loan of 10k ,7.5k was to pay off unsecured loan,1k towards new central heating and 1.5k we kept(but still had under 6k savings)
    the unsecured debt was paid off 3 hours after we got the secured loan,we were told in NO uncertain terms that this didnt amount to D.O.C.(by phone)

    WE are now in the position where we have had to repay the secured loan as we sold the house 2 weeks ago,i suppose i`m wondering now will the DWP pick up on any of this and decide that we were"guilty"of D.O.C when we took out the loan even though we were given the go ahead to do what we did last year,if any of that makes sense
  • rogerblack
    rogerblack Posts: 9,446 Forumite
    woodbine wrote: »
    i suppose i`m wondering now will the DWP pick up on any of this and decide that we were"guilty"of D.O.C when we took out the loan even though we were given the go ahead to do what we did last year,if any of that makes sense

    If you possibly can, get this sort of thing confirmed at the time in writing, if you can.
    Or at least record the call.
    While 99% of the time this would probably be fine, with no problems, the DWP does at times seem to lose papers/notes.

    It's specifically said in the DWP guidance - see the earlier link I posted - that if you are given approval for something before the event, they can't come back later, and change their minds.
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