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    • gray1404
    • By gray1404 4th Dec 17, 1:25 AM
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    gray1404
    Council Tax Exemption backpayment and ESA
    • #1
    • 4th Dec 17, 1:25 AM
    Council Tax Exemption backpayment and ESA 4th Dec 17 at 1:25 AM
    A family member of mine recently received a back payment of £5000 of council tax as they have had refunded. This is because they have had a council tax exemption applied due to severe mental disorder.

    We have been advised this money is disregarded for Income Based ESA purposes for 12 months. However, would ESA actually find out about this money? Is there any way they would be told or would we have to tell them if any of it was left after 12 months.

    He already had £7000 of savings declared to them. Also, is there any guidance on what he can and cannot spend the £5000 on?
Page 1
    • CIS
    • By CIS 4th Dec 17, 7:16 AM
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    CIS
    • #2
    • 4th Dec 17, 7:16 AM
    • #2
    • 4th Dec 17, 7:16 AM
    We have been advised this money is disregarded for Income Based ESA purposes for 12 months. However, would ESA actually find out about this money? Is there any way they would be told or would we have to tell them if any of it was left after 12 months.
    They would have to be told by the claimant/their representative when the money was paid- otherwise if they spot the monies they can potentially suspend the claim whilst they investigate. At the end of the 12 months then the claimant/their representative would have to declare any savings still above the threshold,
    I no longer work in Council Tax Recovery as I'm now a self employed Council Tax advisor and consultant with my own Council Tax consultancy business. My views are my own reading of the law and you should always check with the local authority in question.
    • gray1404
    • By gray1404 4th Dec 17, 8:34 PM
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    gray1404
    • #3
    • 4th Dec 17, 8:34 PM
    • #3
    • 4th Dec 17, 8:34 PM
    Ahhh right so the DWP won't be informed automatically about the backdated payment? So in other words it is up to us to tell them about the money (at the end of the 12 months once it is classed as capital).
    • Ames
    • By Ames 4th Dec 17, 9:14 PM
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    Ames
    • #4
    • 4th Dec 17, 9:14 PM
    • #4
    • 4th Dec 17, 9:14 PM
    Ahhh right so the DWP won't be informed automatically about the backdated payment? So in other words it is up to us to tell them about the money (at the end of the 12 months once it is classed as capital).
    Originally posted by gray1404
    As Tellit said on your other thread you need to tell them now. Otherwise data matching will throw it up and all they'll see is the money's there and not where it came from - it could trigger compliance proceedings so you'd have to go to interviews about whether or not you've committed fraud. Much easier just to tell them from the start.
    Unless I say otherwise 'you' means the general you not you specifically.

    Reading the alphabet in 2017. 21/100
    ABCDEFGHIJKLMNOPQRSTUVWXYZ
    • gray1404
    • By gray1404 4th Dec 17, 9:45 PM
    • 88 Posts
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    gray1404
    • #5
    • 4th Dec 17, 9:45 PM
    • #5
    • 4th Dec 17, 9:45 PM
    So just simply inform them now while its recent. E.g. "have received this Council Tax backdated payment of £x from the council which is disregarded for 12 months" and then they know. Is it as simple as that?

    What sort of data matching would they do in this case? I've not come across that before. Do you mean from the bank or something or the council? (Please excuse me not knowing what this is).
    • Ames
    • By Ames 4th Dec 17, 9:58 PM
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    Ames
    • #6
    • 4th Dec 17, 9:58 PM
    • #6
    • 4th Dec 17, 9:58 PM
    So just simply inform them now while its recent. E.g. "have received this Council Tax backdated payment of £x from the council which is disregarded for 12 months" and then they know. Is it as simple as that?

    What sort of data matching would they do in this case? I've not come across that before. Do you mean from the bank or something or the council? (Please excuse me not knowing what this is).
    Originally posted by gray1404
    It should be as simple as that. They'll probably want to see bank statements and proof of where the money came from.

    I'm not sure of the exact details how data matching works, but I've read on here of people having proceedings started against them because of having money they haven't declared.
    Unless I say otherwise 'you' means the general you not you specifically.

    Reading the alphabet in 2017. 21/100
    ABCDEFGHIJKLMNOPQRSTUVWXYZ
    • gray1404
    • By gray1404 4th Dec 17, 10:23 PM
    • 88 Posts
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    gray1404
    • #7
    • 4th Dec 17, 10:23 PM
    • #7
    • 4th Dec 17, 10:23 PM
    Thanks, we have a written letter from the council confirming the backdated payment so can show them at as proof of

    1. what it is
    2. how much
    3. where it has been paid (it says that in letter too - bank account)
    • Ames
    • By Ames 4th Dec 17, 11:12 PM
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    Ames
    • #8
    • 4th Dec 17, 11:12 PM
    • #8
    • 4th Dec 17, 11:12 PM
    Thanks, we have a written letter from the council confirming the backdated payment so can show them at as proof of

    1. what it is
    2. how much
    3. where it has been paid (it says that in letter too - bank account)
    Originally posted by gray1404
    If I were you I'd send that, with bank statements for all accounts covering the day it went in, and a covering letter explaining what it is and reminding them that it's disregarded for 12 months.
    Unless I say otherwise 'you' means the general you not you specifically.

    Reading the alphabet in 2017. 21/100
    ABCDEFGHIJKLMNOPQRSTUVWXYZ
    • Mersey
    • By Mersey 5th Dec 17, 2:52 AM
    • 1,634 Posts
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    Mersey
    • #9
    • 5th Dec 17, 2:52 AM
    • #9
    • 5th Dec 17, 2:52 AM
    Ahhh right so the DWP won't be informed automatically about the backdated payment? So in other words it is up to us to tell them about the money (at the end of the 12 months once it is classed as capital).
    Originally posted by gray1404


    Gray1404 makes a very valid point.


    Why doesn't the local authority in such instances inform the DWP as a matter of routine (and to avoid any trouble or cost to the claimants?)


    It would be bizarre in the extreme for the national govt in the form of the DWP to suspect fraud due to a lump sum received and spotted via data matching, especially when that lump sum reimbursement only occurred because of the error of another arm of the State in the form of the local govt dept and that would be known (you guessed it)...by data matching.
    Please be polite to OPs and remember this is a site for Claimants and Appellants to seek redress against their bank, ex-boss or retailer. If they wanted morality or the view of the IoD or Bank they'd ask them.
    • gray1404
    • By gray1404 5th Dec 17, 2:55 AM
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    gray1404
    I am still really confused regarding this "data matching". What is it and when does it take place?

    Yes, I know some data is reported, e.g. interest payments made to savings accounts, but a benefit backpayment from another government department, that sounds a bit far fetched. Unless I am missing something?
    • antrobus
    • By antrobus 5th Dec 17, 7:20 AM
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    antrobus
    I am still really confused regarding this "data matching". What is it and when does it take place?..

    Yes, I know some data is reported, e.g. interest payments made to savings accounts, but a benefit backpayment from another government department, that sounds a bit far fetched. Unless I am missing something?
    Originally posted by gray1404
    DWP and HMRC share data.

    Both are also working on systems that match their data with third party data. HMRC get data from the likes of eBay etc. They have Connect.

    Here is a letter that explains some of the things they are up to.
    https://www.parliament.uk/documents/commons-committees/public-accounts/Correspondence/2015-20-Parliament/PAC-Response-final-signed-copy-of-follow-up-letter-to-3rd-party-data.pdf
    • Mersey
    • By Mersey 5th Dec 17, 1:49 PM
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    Mersey
    I am still really confused regarding this "data matching". What is it and when does it take place?
    Originally posted by gray1404


    It's nothing to be unduly worried about.


    Govt bodies and some large organisations such as insurers and banks can share data in order to detect and prevent fraud (from memory s29 of the Data Protection Act is the exception allowing the sharing of confidential personal data about individuals in such circumstances)


    However, in recent years - and to enable 'joined-up Govt' - the DWP, HMRC, Councils have begun routinely sharing more in order to match claims and spot errors, from looking at Electoral Rolls, passport data, births and deaths and so on. Data washing is sometimes used as the jargon by HMRC in their evidence to MPs.
    Please be polite to OPs and remember this is a site for Claimants and Appellants to seek redress against their bank, ex-boss or retailer. If they wanted morality or the view of the IoD or Bank they'd ask them.
    • CIS
    • By CIS 5th Dec 17, 2:04 PM
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    CIS
    You are correct regarding it being s29 of the DPA which covers anti-fraud measures etc for data.

    The National Fraud Initiative goes on every couple of years for local authorities and similar bodies (public and private) to share data but in real terms data is constantly being matched between a lot of organisations to try and stamp out fraud - it's nothing to be worried about. You can pretty much guarantee any person who had claimed any sort of benefit or council tax reduction has already been data-matched at least once, assuming everything is OK you'd never even known it went on.
    I no longer work in Council Tax Recovery as I'm now a self employed Council Tax advisor and consultant with my own Council Tax consultancy business. My views are my own reading of the law and you should always check with the local authority in question.
    • gray1404
    • By gray1404 5th Dec 17, 7:24 PM
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    gray1404
    What sort of data do they match though? It really does sound like "big brother" when you read it. I was under the impression that your bank data was totally private and things like passport data seems a bit too far. So there are private companies (airlines and banks) passing on data to the DWP "just in case." What I mean is that the bank might not even know someone is claiming.
    • epitome
    • By epitome 5th Dec 17, 10:04 PM
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    epitome
    I don't have it to hand, but if I were you I would look up the guidance that says it should be disregarded, just to familiarise yourself with the legislation and reasons for disregard... for example it may only be disregarded if it is official error....so you should ask the council to confirm it is official error arrears.

    There is other guidance that states if the amount is £5,000 or more then it is not only disregarded for 1 year, but it is disregarded for the life of the current ESA claim.... but if the ESA claim closes then it could not be disregarded anymore.

    You need to look up capital that is disregarded
    and capital to be disregarded indefinately

    And confirm that council tax arrears are included in this.
    Last edited by epitome; 05-12-2017 at 10:06 PM.
    • Energize
    • By Energize 5th Dec 17, 10:06 PM
    • 376 Posts
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    Energize
    I've received tax rebates from hmrc before while on benefits and it didn't show up as income on the universal credit system.
    • Mersey
    • By Mersey 6th Dec 17, 1:10 PM
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    Mersey
    That's good to hear Energise, as redress is not profit and so should never be considered as income.
    Please be polite to OPs and remember this is a site for Claimants and Appellants to seek redress against their bank, ex-boss or retailer. If they wanted morality or the view of the IoD or Bank they'd ask them.
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