Can DLA be counted as Income by a Creditor

mr_pickles_2

Good Evening All

My creditor wants me to send in a budget plan but he wants to count my HRM & HRC as disposable income.

Can he do that?

I need to know whether I have to declare it on the form in the income column?

Thank you for any help given.

Caroline73_2

I would imagine it would as it is a 'living allowance' therefore part of your income.

fatbelly

It's not a straightforward 'yes' or 'no'

DLA is paid for a care or mobility need. It's not counted as income for the purposes of calculating means-tested benefits.

If you are actually spending the DLA on a relevant provision, like a motobility car or paying a carer then it needs to be shown as an 'in' and an 'out' on your financial statement and therefore is not available to your creditors.

However, many people do in practice use DLA as income and some would be unable to make any offer to a creditor unles they did that.

I am also aware that some people hold strong opinions on this subject.

jeckyllandhyde

The short and correct answer is NO it should not counted as income.

DLA is paid to you to help with costs associated with your disability and is not classed as income when providing creditors with income / expenditure figures. Some companies will try and count it as income when making recoveries of debt but they should always be challenged and will normally back down.

When you complete the Financial statement that will normally be required by creditors (income / expenditure) you must enter the DLA amount you recieve as income and then enter the exact same amount as expenditure and label it Disabilty Living Expenses, therefore cancelling out any surplus income.

I hope this helps - go to the CAB for further clarification if your not sure !

mr_pickles_2

Thanks to you all for your contributions:beer:

It would seem that my creditor is just trying it on then.

I thought that they could not count my hrc as it is for my care needs, not an income as such and my hrm is used for a car on motoability.

I did tell them this as I believe I read it somewhere before, but could not find the article and my creditor said that I was wrong but I thought I would ask advise before getting back to them with figures.

I will do as suggested and add the figures and then minus them out.

Thank you very much indeed:T

Nigella_2

Best do a budget / get free advice with CCCS / National Debt Line.

Creditors are only interested in getting paid and will say anything to get you to cough up! They should be more helpful under the banking code BUT many debts are sold on to these debt companies that have no sympathy!!

mr_pickles_2

Thank you for your advice
I have now done a budget plan using the template from Nat. Debtline.

I had a phone call on Friday at 4pm from my creditor(debt collection agency working for HFC) they wanted to put my repayments up to £84 pm from £10pm...I told them that I would never be returning to work due to disability and he wanted me to do a budget plan over the phone at that minute and I tried to explain that I could not do that as I needed to work the figures out but he tried to make me do it and I pulled a couple of figures out of the air but told him I would have to ring him back with the figures as I did not know them and was only guessing which I was not happy to do. He told me on the basis of the figures that I had given him that he wanted at least £84 per month from me. I said you should not be counting my dla as income and I was also paying for my motability car from my HRM and that he could not use my HRC as income...he said they were allowed to and he insisted on at least £84 per month. I said I would work out the figures and get back to him as he had caught me on the hop and I had only just got back in the house from a very exhausting Hospital check up so was not in the right frame of mind to deal with his request at that moment. I spent the next 6 hours trying to work out the details but was so worn out that I felt ill. I then spent Friday trying to work out the figures again and now feel able to consider that my budget is correct. I was going to ring them on Monday morning but my direct debit goes out at midnight Sunday and that is worrying me in case they try to take out £84 instead of £10 as this will leave without any money for the next week as all my DD's go out at the same time and I don't receive anymore money until the following Monday.

Can they take out more without my agreement?

Thank you for any help given

methusala_2

they could take more than 10 pounds yes, but they HAVE to give you 10 days notice of the increased ammount and if they do not do this then you get the bank to refund the extra deduction immediately under the direct debit indemnity clause of the banking code of practice.In fact the company SHOULD give you 10 days notice of all deductions via direct debit. If your losing sleep about this, personaly I would cancel the DD in respect of this debt and make payments via on line banking via a BACS transfer each month. All you need is the sort code and bank account number of the company which you allready have in the DD setup.