offsets and benefits

magicdogsbrain

I have an offset mortgage and was wondering if that would affect any means tested benefit.

I have posted a thread on the redundancy forum – as this was really the reason I wanted to know (in case the worst should happen).

Now the question is, I have an offset mortgage where my current account and various savings pots are under the “offset” umbrella. I do not receive any interest on these savings – but the amount of loan is reduced by this money – so I pay less interest.

If this capital was classed as “savings” I would receive an interest payment that I could use to manually offset any loan facility that I had – but I would pay tax on that.

The Building Society does not regard this money as savings (otherwise they would pay me interest which would be taxed) – so is this counted as savings for means tested benefits?

It would seem that you can have hundreds of thousands of pounds tied up in property (one person living in a 10 bedroom house) and still claim income support – yet a few thousand in savings and you have to use that.