Housing Benefit & Children's Savings

LouiseErd

Does anyone know if the rules relating to children's savings if the parent is receiving Housing Benefit?

I receive Housing Benefit to pay about a third of my rent as I am on a low wage, and 4 years ago my father made my son a gift of £3000 as a savings bond. (With interest it's now about £3400). He said that as a gift from a grandparent to a grandchild it should not have anything to do with my finances, the account is in my son's name and the statements are addressed to him.

When I filled in my claim form, I listed my savings account & current account but not my son's account as it was not requested. It just asks for details of savings & investment details of the claimant and any non-dependents eg a lodger. But not for savings of a dependent child so there was no place for me to enter it.

My father mentioned adding to my son's savings & I have just googled to see if the rules have changed - I have now found one website which says "If you have dependent children who have savings of more than £3,000 you will not get an allowance in your applicable amount for them. We ignore a child's savings of less than £3,000."

That is just one site though, I can't find any other page which mentions this - just ones which say you can have up to £6000 savings before your benefits will reduce.

Now I am worried that
a) because the savings is £3000+, then I may have been overpaid benefit over some time - but I can't work out how much.
I think it may not be much per week (as I do not get that much HB anyway) but obviously that will add up if it's backdated 4 years.

b) I should have declared the account at the time it was opened, even though I have looked back at the old (and recent) forms & there is no question I can see relating to savings of dependents. So I filled in the forms in good faith at the time, but I'm really worried if I declare the account now they will say I have tried to hide it for 4 years - or even that my whole claim is fraudulent.

Is the rule about children's savings a recent one? I really can find only one reference to it on one website.

LouiseErd

Bumping a bit, & realised what an unreadably long post I made last night!

Summary - how do I find out if a dependent child's savings (which were a gift from a grandparent) will affect the parent's Housing Benefit?

pmlindyloo

Have searched for an answer to this and keep getting conflicting information!

Suggest you give CAB a ring and they should have the correct information.

Good luck!

Kimitatsu

This was all I could find :

If you and your partner have combined savings of more than £16,000, you will not get Housing Benefit. If you and your partner have savings of £6,000 or less, we will ignore them in working out your benefit. For every £250 in savings you have above £6,000, the rules say we must add £1.00 onto your weekly income. For example, if you have £3,500 savings, we add £2.00 onto your weekly income.
We ignore any actual interest your savings earn.
If you have dependent children who have savings of more than £3,000 you will not get an allowance in your applicable amount for them. We ignore a child's savings of less than £3,000

LouiseErd

That looks like the link I found - it's worrying as it looks like I should have notified them of the account, but I can't even tell from the site if its up to date information.

Seems odd that a parents savings of £6000 could be totally disregarded, yet a child's savings of £3000 would reduce the benefit substantially as it's a smaller amount which neither I nor the child can access (as its a bond) for everyday expenses. I can see that it should be counted as an asset though.

Hard to remember that far back, but when the account was opened, I'm sure I tried to find out if there was a problem, but all I could find was info that it was OK to have up to £6000 savings before the benefit was reduced - and then on the HB form, it just did not ask about savings of dependents (or I would have filled that in, obviously).

So as the money was
a) under £6000
b) info wasn't requested and
c) it isn't my money (I can see there would have been an issue if I transferred money to my son's account to reduce my own savings in order to be eligible for benefit - but this was a gift direct from a grandparent to the child) - I didn't worry about it.

Do you think it is preferable to ring CAB rather than Housing Benefit to clarify?

Kimitatsu

Who is the signatory on the account? I dont know how old your son is but if he is under 7 I think he needs an adult to be a signatory.

If your Dad wants to invest more money for your son, then I would suggest that HE needs to open an account and be the signatory on it, that way you dont have anything to do with it.

Reading some of the other threads though that I have trawled through, the concensus seemed to be that you would have £1 deducted from your benefit for every £250 you were over the £3000 limit. I would ring the CAB as they will have access to the most up to date data for you.

LouiseErd

I will ring CAB (but can't just yet as I'm at work)

I did just find this post here on MSE

"It used to be the case. The rules changed in 06, possibly 07.

Every time a query over capital of a dependent comes up I slog through the regs and circulars etc looking for proof, and fail. It's correct, though.

Edited to add: the wakefield website - is that a current page or an old page thrown up by a google search? "

Which might explain why I didn't have to declare it in 2006, & couldn't find info about it then.

I have definitely filled in 'change of circumstances' since then, when tax credits go up or down, but have also had claims renewed after just a phone interview. Which of course I don't have a record of (I always try & keep photocopies of forms I've filled in).

Son was 7 when the account was opened - it sounds like even if he became the signatory now, the savings would be counted.

I'm more worried by how long an overpayment may have gone on for, hope CAB can tell me when / if the rules changed.

nannytone_2

as long as you don't have access to the account, i'm pretty sure that it's disregarded.

LouiseErd

I'm worried that techically, I do have access to the account as I am named on it, even though the account is in my son's name.

Can't phone CAB till Monday...

I have looked at a recent HB letter to try & work out what HB I should have been getting if the child's allowance in the applicable amount is not counted - it looks like I may (in the worst case scenario) have been overpaid by £40 a week since 2006. Which is about £8000!

But if his savings were (just) under £3000 I would not have been overpaid at all, so I really hope I have misunderstood how they would apply that.

Does anyone know what would happen if I go to HB & say I've just realised I should declare this account from 4 years ago??

Of course if I have been overpaid, I would want to repay - would there be other consequences if I volunteer the information & explain it was a genuine mistake?

(Goes without saying I will talk to CAB first, but it feels like a long time till Monday!)

amersall

Just my opinion on this, but if the savings were £3000, account opened 4 years ago and child savings under £3000 are not taken into account, then surely the only money that could be counted for benefit purposes is the £400 interest over the 4 years?.Or is it because the account was not declared that more is owed? I could have this all wrong and please feel free to correct me if i am off base.

nannytone_2

if you can access the savings it is counted as your money.