Another deprivation of capital question

Elaine_Wilson

A friend needs to move soon and is considering renting a flat. Her income is not high as she has to fit work round her baby and she will need to claim housing benefit.

She will not qualify at the moment because she has more than the maximum capital in an ISA.

Now I know you might think she should not be trying to claim whilst she has money invested but I have a small amount of sympathy for her.

She was advised to invest in an ISA instead of a personal pension and so looks upon this money as her pension pot. (She did have higher earnings in the past)

If she were to close the ISA and put the whole amount on a pension would this be deemed deprivation of capital? If she did this and then could not claim benefit then her income would not be sufficient to live on in the flat.

dmg24

If she is moving the money in order to claim benefits, then that is deprivation of capital.

Elaine_Wilson

Thanks. I suspected that would be the position.

I was just clutching at the straw that this might be possible since by putting money into the pension (as the government encourages us to do) she will reduce her reliance on state aid later in life.