Acceptable use of capital

esmerellda

I am currently not entitled to any means tested benefits due a)my current circumstances and b) due to a property I joint own with my ex. When this sells I would like to use the equity share I will receive to invest in purchasing a new property. As my circumstances are currently improved I wouldnt be in receipt of any benefits following the house sale anyway, however if my circumstances should change and I would (barring the capital) be entitled to means tested benefits like income support, would having invested the money back into a property (to live in) affect that ?

(I'm not looking at a mortgage or anything just purchasing outright with my share of the equity)

Bit of a hypothetical question, but I have only just come out of a position where I was only living on child tax credits and child benefit because I was a single parent but wasnt entitled to any benefits (no IS, HB or CTB) due to the capital in the joint owned property, and if things dont work out, would rather not have to do that again.

cattie

If you are using the money to buy yourself a home outright & will not be apply asking the DWP for help with interest mortgage payments, you should not have any problems. Funds from a house sale are disregarded as capital for 6 months if to be used to buy yourself a new home & can be extended for a further 6months if needed by DWP. Once you've bought the home to live in, it isn't regarded as capital.

The only problem you could hit would be if you were buying a high value property whilst in receipt or applying for a means tested benefit. This wouldn't be acceptable to DWP & you could then fall foul of deprivation of capital rules.

esmerellda

Ahhh thanks cattie. It would be a pretty low value property (simply so I dont have to rely on being able to afford a mortgage) and just some security for me and the kids really. Makes more sense to put the money from the old house into a new one save us having to pay rent. Hopefully the situation where it might be a problem won't arise.