Are Children's Savings / Premium Bonds Considered as Parents Capital

Parsnip4

Hi

I am in the position where my job is likely to be made redundant - (not yet confirmed) early next year due to relocation of the business.

Having always worked - 26 years without claiming benefit, I am concerned that the donation of £5,000 premium bonds plus £1,000 to savings accounts for each of my 2 children given by my parent's, following my Gandfathers death would be taken into account in assessing any benefit that I may be able to claim.

Please can anyone advise what the situation would be and the best course of action to take?

roonaldo

you have almost answered your own question, they are your childrens account so no they wont be taken into account.

sammyjammy

Not strictly true Roonaldo, there is a limit on childrens capital and when it can be taken into account, it was £3000 and over but it may have changed.

Vader123

roonaldo wrote: »

you have almost answered your own question, they are your childrens account so no they wont be taken into account.

This advice is incorrect.

People have moved their "family savings" to their children and pointed to them saying "Its not ours, its for the kids, will someone think of the children!", when actually, childrens savings is available to the whole family and and the guardians have full access to it should they need it.

So, it used to be 3K for kids, anything above it is deducted on a pro-rata basis.

If you ever get off benefits, the savings and income of the household is no one business but your own, while you are on benefits, you need to account for it.

Cheers
Vader

Parsnip4

So the £5k premium bonds that my parents gave to each of my 2 kids will be counted as our capital. This is out of order considering it was a specific gift from my parents following my Grandad's death. It hacks me off that after paying in for circa 26 years I would have to spend this money prior to be eligible for any type of benefit - never claimed a penny and hopefully will not have to; this really hacks me off - can I give bonds / value back to my parents? - this was given to my kids not money shifted to one side by me.

Does anyone have some constructive advice as to what I can do?

bryanb

Parsnip4 wrote: »

this really hacks me off - can I give bonds / value back to my parents?

Maybe the owners (you said the children) could.

The children are part of your family, no doubt if it comes to a benefit claim you will expect the taxpayer to support them so why should their assets be ignored?

GlasweJen

if you gave the bonds back then it would be seen as an attempt to intentionally deprive your family of capital in order to recieve benefits, your family would be treated as if you still had that money when being assessed for means tested benefits and in the worst case scenario you could be charged with fraud. When you're made redundant presumably you will have a redundancy package and you will also be entitled to contributions based job seekers allowance for a time, this is not dependant on savings. You should be able to get a new job within the window of CBJSA so the kids savings shouldn't really be an issue.

merlin68

We applied for a crisis loan whilst we were waiting for our benifits to come through and because our kids had 750 each in their accouns, we were told to use that first.

Macro_3

This is a topic which seems to cause a lot of confusion, possibly because the rules have changed in the last few years and differ depending on the benefit claimed. I'll assume that if you are going to be made redundant, you would be claiming Jobseekers Allowance and Council Tax benefit (and possibly Housing benefit, if you rent).

For JSA/IS, the capital of children is disregarded when working out how much capital the claimant holds. So the capital is not counted as 'yours'.

However, if a child has more than £3000 capital, the child's premium is not added to the claimants applicable amount (although the family premium is) when working out how much you need to live on. Since there are no child premiums in JSA (as benefit would be paid for children under the Tax Credits System in your case) this would not affect your claim for JSA. The savings of your children would have no effect.

As for the council tax/housing benefit, the savings are disregarded entirely and you would still receive the dependent premiums in the calculation of benefit. That's because the HB assessors are the nicest :rotfl:(nothing to do with the law *cough cough*)

I'll caveat that by saying that the savings would need to be entirely those of the child and the account not used by others for example to pay wages into etc, as they may then appear to be yours and could be counted as such.

One of the earlier posters mentioned claimants moving their own savings to their children in order to qualify for benefit - this does sometimes happen but would be dealt with under deprivation of capital.

real1314

Macro wrote: »

As for the council tax/housing benefit, the savings are disregarded entirely and you would still receive the dependent premiums in the calculation of benefit. That's because the HB assessors are the nicest :rotfl:(nothing to do with the law *cough cough*)

I'm fairly sure that you're wrong on that point - the £3k limit on children's savings applies to HB and CTB in the same way that it does to IS.

This is a quote from Wakefield Council's website:

"We ignore any actual interest your savings earn. How much benefit you may get can be affected if you have dependant children who have savings of more than £3,000."

Macro_3

It used to be the case. The rules changed in 06, possibly 07.

Every time a query over capital of a dependent comes up I slog through the regs and circulars etc looking for proof, and fail. It's correct, though.

Edited to add: the wakefield website - is that a current page or an old page thrown up by a google search?