Receiving money from sale of house so benefits stopped.

j01349

A family member is selling there house and moving to rented accomodation due to medical issues. They has been advised that their benefits will stop when the sale completes however they will be given back if the money has all gone in six months. The house was originally meant to be inheratence for their kids however as needs must they now have to sell up & will have to live of the money instead due to the benefits stopping. As advised by cit advice the money can be spent on certain things which are acceptable e.g. £10000 on a new car, however we are wondering about some of the advice given as it seems to have changed since first advised. Can our family memeber open more than one trust fund for family members eg one for each child. Also is it acceptable if they help out a daughter who has some debt mostly caused due to taking time of to care for said parent etc. It has been mentioned that receipts will be needed to prove all purchases which is fair enough however they are now worried they can not help their daughter as the debt is not in their name so receiot would show something different. Is this acceptable or is there any way around it. Thanks

alwaysonthego_2

I think you need to google 'deprivation of capital', but if they give away the money i.e put it in trust funds and pay off their daughter's debts then they will be treated as still having the money. I would also advise them to ask the DM before they spent any of the money on a new car to clarify whether they would treat ot as DOC.

BTW we are not allowed to assist you in finding ways around the benefit rules.

McKneff

None of what you think they can spend it on is acceptable. It is called deprivation of capital and they will be treated as if they still had the money. They can spend money on essentials and like you say, they have to keep and provide receipts.

They really cannot expect to buy a car for £10k, settle the daughters debt at the expense of the tax payer really, can they.

tcr_3

Alwaysonthego and McNeff are right.

OP, you've been given some really duff advice by the CAB.

getmore4less

Why cant they buy a place that is suitable rather than rent?

MIght not help if they need care in the future the house still gets sold off.

j01349

Thanks thats what we though £10000 for a car, £5000 for a holiday & £2000 on tv all apparently legit ways to spend money according to cit advice. We are not looking ways to get around the benefit system just trying to find out what can actually be done with the money as had every thing went the way it was meant to their kids would have received the profits from the sale which is why they are concerned the kids will be missing out on what they had wanted them to have.

j01349

selling house for 72000k so getting a house less than that would be hard to find also due to medical reasons not in work.

Mojisola

j01349 wrote: »

Thanks thats what we though £10000 for a car, £5000 for a holiday & £2000 on tv all apparently legit ways to spend money according to cit advice.

This is really bad advice. It would be acceptable to use the money on things related to their health problems - stairlift, new furniture that is easier to get out of, a good bed and mattress - and a modest amount on things like TVs and a reliable car. Any extravagant spending is likely to cause them problems.

Someone at the CAB needs to go for retraining.

What benefits are they on? Not all benefits are means-tested so they might not lose them all.

[Deleted User]

I think this so called advice from the cab has been passed on to the OP,these things often get confused(im being generous)in the telling.

Caz3121

j01349 wrote: »

selling house for 72000k so getting a house less than that would be hard to find also due to medical reasons not in work.

The decision maker will have a guide on what they will class as acceptable purchases and an acceptable spending rate. Using the spending rate they will calculate when the capital would be expected to reach a level that would qualify for benefits....if it is all gone before then they are likely to still treat it as if the money is still available....I would expect that a figure like that would be expected to last a few years

j01349

on DLA & Income support so not sure which are means tested. CA info came direct so if this is infact wrong then yes they do need to retrain. Car would be beneficial as currently they dont have one and new rented house is quote remote in order to be closer to realitives in order to help them with everyday tasks. Stairlift would have been required in own home however new house is all on one level one of the main reasons for the move. Dont forget that the mortgage etc has to be repaid out of that 72k along with any other debt so it will be signifigantly less.