About to go on Working Tax Credit and received Inheritance... help!

pintsizeally

Hi, any help appreciated, CAB have not been that helpful and the Inland Revenue site Ive found quoted is from 2003 and i cant seem to pinpoint small print and uptodate info about it all.. and who knows what the new gov will change in the next few months!

Basically need to know how much inheritance you can recieve before it will affect working tax credits..

Im currently a single mum (2 year old) on Income support at the moment, just finished studying and hoping to go into work part time on working tax credit in a few weeks. My uncle died 2 years ago intestate and we just found out this week that he has left us some inheritance, he had many shares which are being divided between us, (my sisters) the number is not confirmed approx 6000 pounds worth of shares each, if sold now, there is also a 7000 pound cheque on top of this. Which is a very nice surprise as we are not well off, however, how will this affect my claim for working tax credits? It has not be finalised yet so do i claim as i am now, or declare the what i know approx inheritance or claim as i am now, and change it later when its all been finalised? Does that make sense? i hope so!!

I will pay off 2-3000 in debts and possibly upgrade my (falling apart thanks to pot holes) car.. do i need to declare that ive done/will do that?? I would also like to save the rest either as cash in an ISA or as shares for my daughters future, how much can you have before it affects your claim?

i saw on the forum here that in 2004, IR only took into account anything over 300 per year earned in interest.. is this still the case? and how can you tell what shares will earn each year? i havent a clue when it comes to shares!

thanks in advance :j

Murgatroyd21

It is still only interest and dividends that are counted, and the £300 disregard is applied once all other income is added together, including interest and dividends, for taxable purposes for the year.

AnxiousMum

You don't need to inform tax credits of the inheritance, only any interest earned over the £300 point in the year. However, if you are a single parent, not working, I assume you might be getting LHA and possibly CT benefit. You will need to inform these agencies when you receive your inheritance as these are both means tested benefits.

In terms of spending your inheritance, you will need to show them that the spending has been for legitimate things that are needed, as otherwise they will continue to treat you as if you have the whole amount (if over £6K) for a while, as could class you as having deprived yourself of income.

pintsizeally

Thankyou Murgatroyd and Anxiousmum...

Anxiousmum, yes i am in receipt of HB and CTB, so i will do that, and as one of my biggest debts is the loan with the HB office for the deposit on my current house, that'll be easy to show as legitamate!

My auntie said she will send me 3000 now and more later, as this is under 6000 do i still need to declare it? and Until i recieve the completed shares which could take some months, shall i just apply for working tax credit as i am now and then do a change of cirumstance in a few months when its all been finalised? or is that withholding information?

Basically do i inform them of what ive received when its finally here (HB and CTB too) or what i might receive?

thanks