Housing benefit if live-in son has a lot of capital

jordan_ash

I have a relative over 82, a widowed council house tenant. She has a son living with her, early-retired (54) with a small pension (£800 a month) who also has ISA, savings account (£50,000 +). Widow receives housing benefit at the moment, son is classed as non-dependent by council. Son pays about £120 a week into his mother's bank account. I would be grateful for advice on whether the widow should inform council of son's capital/would this affect housing benefit ?

leemack

The LA don't need to know about his savings, just his income. Is the £120 a week for the non dependant deduction (can't be as its too high) or is it for something else, as the LA may look at this as income for the mum.

jordan_ash

leemack wrote: »

The LA don't need to know about his savings, just his income. Is the £120 a week for the non dependant deduction (can't be as its too high) or is it for something else, as the LA may look at this as income for the mum.

Many thanks for the reply ! The £120 a week is for living expenses, to cover council rent etc and part of the food/heating bill. Would that be classed as income for the mum ?

tboo

£50.000 savings must surely give the non dependant interest so she must tell the benefit department as it may change the non dependant deduction. It does ask on the forms when initially claiming and afterwards a change of circumstances form must be completed
As per our claim form - other adult section.
Do they have any other income at all?
Make sure you tell us about all other income they have, This includes any benefit or allowances you have not told us about and interest form savings and investments.
Also the £120 paid has to be declared as this is also asked
Do they pay rent or money for board and lodging to you or your partner?
Does this include money for food or heating?

If the lady is in receipt of AA then ignore above but inform the LA just in case they aren't aware of the AA

fluffymovie

Hi, no this wouldn't be classed as income as he is a non dep.

The level of deduction is based on gross earnings so they may need to know about the capital as if he has over £50,000, he would be getting some good interest.

Haven't got my regs with me at the moment but I am sure another HB bod will be along presently!

leemack

need to declare the £120 as income for mum, with a breakdown of what it is for.

Then he needs to declare interest and pension as a non dependant.

fluffymovie

If the LA used the £120 as well as a non dependent deduction, the customer would be penalised twice. We don't use both in my LA for this reason but perhaps others would.

If the mum is on Pension Credit, you may need to advise them of the income but any increase in the level of non dep deduction is delayed for 26 weeks if she is over 65

Uncertain

fluffymovie wrote: »

Hi, no this wouldn't be classed as income as he is a non dep.

The level of deduction is based on gross earnings so they may need to know about the capital as if he has over £50,000, he would be getting some good interest.

Haven't got my regs with me at the moment but I am sure another HB bod will be along presently!

There are plenty of ways he could invest it aiming for capital growth and not income. OK, it is playing the system and needs doing carefully but could be entirely legal. Depends if he wants income from it in the short term.

suelees1

I really don't think she needs to declare this weekly income at all. He's not a lodger as such and it only covers his portion of the housekeeping and bills as well as what his mum has lost in housing and council tax benefit.

Macro_3

Income received from a non-dependent in respect or board and lodgings is wholly disregarded in the assessment. The claimant cannot be penalised for having a non-dependent in the household twice. It does not need to be declared. Schedule 5 para 20 something, if anyone can be bothered to look. Same applies to dependents.

The interest earned on the capital must be declared - it is added to the non-dependents gross earnings figure to calculate the non-dependent deduction.

real1314

Macro wrote: »

Income received from a non-dependent in respect or board and lodgings is wholly disregarded in the assessment. The claimant cannot be penalised for having a non-dependent in the household twice. It does not need to be declared. Schedule 5 para 20 something, if anyone can be bothered to look. Same applies to dependents.

The interest earned on the capital must be declared - it is added to the non-dependents gross earnings figure to calculate the non-dependent deduction.

I'd agree with the first para, but my recollection is that the increasing rates of non-dependant deductions apply to people in remunerative work, based on their gross income.

Iirc, the lowest rate applies to someone not in remunerative work and not receiving income support, £7.40 when I last checked.