2009 has been a bad year :(

Iapetus_2

Hi everyone, long time reader of the forum but first time poster, hoping for some help and advice.

Following the sudden death of our eldest child our world has been ripped apart. I took 9 months unpaid leave and it looks like I will be made redundant from my job. I am looking to go self employed but my income is likely to be very low in the early years, probably only around £4k in year one, £6k in year two and hopefully reaching around £15-£20k in a few years.

My wife, children and I have some significant savings following some inheritence. My wife and I have £40k in premium bonds and £30k in premium bonds for one of our children. We have two children. We have a mortgage of £40k.

My plan is to cash in the £40k of premium bonds to pay off the mortgage (premium bonds returns are rubbish now anyway) and to take the redundancy and go self employed. One of our children would still have £30k of premium bonds, which we do not want to touch as it will be for them when they are older.

I've tried putting our details into the online tax credit calcualtors and it appears that CTB and WTC combined would give us around £1k per month - is this correct? - It seems to be more than I would of expected. Basically, our income if I go self employed will be so low that it we will not be able to survive without the WTC and CTB.

Would the £30k premium bonds in our childs name mean we would not be able to claim council tax benefit? (currently £151 per month)

Thanks in advance to anyone who can offer some advice on our situation.

prowla

Pay it into the mortgage, and then borrow against it (or get a flexible mortgage).

quietheart

Sorry you've had to live out the nightmare of losing a child.
I truly hope 2010 is easier on you and your family.

alwaysonthego_2

Hi sorry about the loss of your children, cannot imagine how you are feeling

If you have significant savings, it is up to the desicion maker to decide whether you have intentionally deprived yourself off your capital in order to claim benefits. The upper limit for claimimg CTB is £16000 below that amount anything above £6000 is reduced from the benefits £1 for every £250. To pay the mortgage can be classed as deprivation of capital and you can be treated as still having it, even if you do not. In the eyes of a DM to pay off the mortgage will not be seen has being reasonable whereas paying your regular monthly payments out of your savings would be.

alwaysonthego_2

prowla wrote: »

Pay it into the mortgage, and then borrow against it (or get a flexible mortgage).

People have fallen foul to this when they were borrowing on 0% and putting the money in an ISA, this was still classed as capital.

Iapetus_2

Thank you for the replies and kind words.

So it looks like we would not be able to get any CTB, not the end of the world. If I did pay off the mortgage, what sort of time period would have to pass before its no longer considered a deprivation of capital? For example, would I be able to claim in a years time?

Probably what is more important for us is the amount of WTC and CTB that we would get. I have never claimed WTC before and we only get a small amount of CTB so this is all new for me.

Some days I really feel like giving up - but with a young family to think of I have to keep on fighting. I'm determined to make 2010 a better year for us.

alwaysonthego_2

I would suggest you go to the CAB and speak to a welfare rights worker who can help you establish this, but it is up to the DM ultimately.

If you post on the families and relationships board you will meet some lovely posters who have suffered like you have and you will get lots of support, take care and all the best xx

jennihen

Iapetus I am so sorry for your loss and while I can't offer you any constructive advice, my deepest sympathies are with you and I hope that 2010 is a better year for your family

Sincerely yours
JH xx

Redsky_2

I'm sorry to hear that..I hope 2010 is a better year for us all!

funkyprincess

So sorry to hear of your loss. You have done well to find the strength to be strong for your family and yourself.

Just from personal experience, I can only offer a bit of info on using the tax credit calculator. I found that the estimated figure on the calculator was much more optimistic than the actual amount.

It may have just been my particular situation, but I wouldn't rely on the calculator's figures too much.