housing benefit and savings

Caz3121

If you have a child living with you, you will receive child benefit and child tax credits. have a look at entitledto.co.uk and you may find that together with your income you may well be able to manage...are you currently receiving working tax credits? As others have said to have £19k in your bank one day and suddenly have it drop to a figure that will allow you additional benefits will look very much like deprivation

tax credits entitlement tables here http://www.hmrc.gov.uk/taxcredits/people-advise-others/entitlement-tables/work-and-child/work-no-childcosts.htm
child benefit £20.30
and maintenance from the mother

Indie_Kid

You don't need to pay your student loan off out of your own money.

jiboom

AsknAnswer2 wrote: »

The state will not support you when you have the means to do so yourself. If you use your savings to purchase things which are not considered neccessary such as a plasma TV, a holiday abroad or to pay non priority debts that is viewed as deprivation of capital and they will treat the claim as if you still had the money available, because ultimately by spending savings on luxury items and/or non priority debts you would have placed yourself in the position of having to claim from the state by frittering away available cash on items or debts which are not a priority. If, on the other hand you have priority debt to pay, this is not viewed as deprivation of capital because if a priority debt is not paid it can result in you having serious action taken against you.

Priority debts are:
Mortgage
Loans secured on your property
Rent
HMRC debt (tax, national insurance, tax credit overpayments, VAT)
Council Tax
Utility Bills
Hire purchase
business rates
court fines
child maintenence.

Non priority debts are:
credit card
store card
catalogue
water rates
bank debt (overdrafts/loans)
personal loans
loan shark loans
money borrowed from family/friends

thanks. guess i should have sodded saving and wasted it all. now will live with people who never worked or bothered saving who have cars, plasma tvs, hols, nice clothes getting all sorts of benefits and cause i went without ill get nil. Actuallt worse than that as my savings will be eaten up but i will still be left with the uni debts to pay off......

sh1305: what do you mean i dont have to pay it back out of my money ?

Indie_Kid

I mean unlike a bank loan, you're not expected to make any payments until your salary reaches £15k pa.

dktreesea

Council houses rent wise don't work quite the same as privately rented properties, because you don't get housing benefit paid to you as a local housing allowance - if you are entitled to anything they would just reduce your rent.

I would have thought, by the time you buy essential things for the house, like beds, a table and chairs, a sofa, paint if the place needs a lick of paint inside (our council provides the paint but some councils don't) kitchen utensils, pots and pans, crockery, a stove (yes, a stove - if council houses where you are are anything like where we are, they come absolutely stripped; make sure it has a separate grill :-)), a washing machine, curtains, a ladder or step ladder (unless you plan to levitate whenever you need to change a light bulb), cleaning things, I don't see how you are not going to get below £16,000 just furnishing the house with the basics. Then there's the towels. And the bed linen. I remember going to Asda when we first set up house here - £200 quid later for a few cleaning things, duvets, pillows, bed linen and three towels. I felt like I had met "Mr Daylight Robbery", in person.

If you are leaving home and have nothing to set up house, all those bits and pieces add up.

In any event, the deprivation of capital rule, as far as I know, only applies if the main purpose of divesting yourself of your savings is to qualify for a higher level of benefit. If you need to furnish a house, then you need to furnish it. Surely that need exists regardless of whether one of the consquences is to improve the rate you can claim a benefit at?

With your Mum, how about just entering into a repayment plan with her? She lent you money - now you're paying it back. Even if it is just £200 a month. My advice would be to set it up as a direct debit and forget about it.

With setting up the house, just keep all the receipts. If they question things on the basis of deprivation of capital, ask them to tell you which of the things you bought wasn't essential. What do they think, that everyone setting up house for the first time, especially where little ones are involved, should buy everything second hand?

Do you work more than 16 hours a week? If yes, once your capital gets below £16,000, I suggest you apply for working tax credit (administered by the HMRC, thank goodness. They at least, unlike the council and DWP, understand what it is like trying to manage on a low wage in the real world). As soon as it comes through, apply for your housing and council tax benefit.

And don't let people on here make you feel bad for claiming anything. The benefits system is what it is. If you qualify for help, then you should get it. If the minimum hourly wage was set at a living wage no one working full time would need to claim for anything.

Indie_Kid

WTC isn't affected by savings - only taxable interest above £300 pa.

jamesd

"P1.703 A claimant should still be regarded as having deprived themself of a capital resource if they have disposed themself of it by way of a gift to a third party. However, they should not be regarded as depriving themself of it if they did it to
HB(SPC) Reg 47; CTB(SPC) Reg 37

* reduce or pay off a debt they owe
* purchase goods or services the Decision Maker considers reasonable, given their circumstances, eg
o payments to reduce/pay off a debt, eg paying a credit card account or mortgage early
o for day to day expenses
o to improve their quality of life, eg buying a new kitchen or car
o for medical treatment
o for home repairs
o for a holiday"

You're repaying a debt. Have her gather proof of the times and amounts lent to you by your mother, bank statements and such. Have her send to you a demand for repayment letter noting that the loans were repayable on demand. She shouldn't in any way mention housing benefit/LHA or your own situation; as a lender it's only her situation that she should write about and she should avoid doing that as far as possible.

Do not show knowledge of the savings limits for benefits means testing. The more you know, the more likely it is that you might be regarded as deliberately trying to get around the system.

Don't have the amount of savings you're left with conveniently just under the means test savings limit. That's a guarantee that it will look like an attempt to play the system.

While repaying a mortgage early isn't deprivation of capital, it's still not wise to repay your student loan sooner than required because it's not payable at all until a certain income threshold is reached. Which means you might end up never having to repay it if you stay poor for life.

lazer

i've never understood the deprivation of capital rule. I think savings should be considered as savings net of any amounts owed (ie, if you have £10k in savings and £9k credit cards - you have only actually have £1k in savings)

If you have a credit card in a rent free and the rent free period expires, meaning you then have to pay extornionate rates of interest, are you seriously meant to pay it off at minimum payments as paying it out of savings would be classed as deprivation of capital?

To to OP - My advise would be to furnish your house to a decent standard - you worked hard for your money, so you deserve a nicely furnished house, and as long you keep your recepits i can't see this being classed as deprivation.

As for paying off your student loan - this depends on what sort of student loan it is - is it from the Students Loan Company or a Bank loan, i know that the student loans previously required that you could defer the payment until th income reached a certain threshold, and then it entered normal loan repayments - is this like yours? I which case - you can only continue to make the normal payments and not use your savings.

As for what you owe your mum, arrange to pay her back at a high monthly amount and that way your savings drop below the threshold much faster, and the repayments could be seen as being reasonable, or possibly even as rent for the period you were living there!

Consider all the options you have and then decide the best for you!

Deepmistrust

I wish I could save 19k on a salary of 100 p/w

Indie_Kid

lazer wrote: »

To to OP - My advise would be to furnish your house to a decent standard - you worked hard for your money, so you deserve a nicely furnished house, and as long you keep your recepits i can't see this being classed as deprivation.

But it depends (like I've said) what type of furnishings the OP buys.