Deprivation of capital ?

joeking_2

Hello, I wonder if anyone can advise on the following

I worked abroad for a few years, and when I moved back this September I bought a house, exhausting all my savings. I was initially still working for, and being paid by, my overseas employer, but I've just heard that I will be made redundant on 1 Dec with no redundancy compensation (that's another story). I've been living pretty much hand to mouth these last couple of months, using all my spare income on doing up my house. I also have two young children (I'm a single parent). I've never claimed benefits before (except child benefit, which I applied for but didn't hear anything back yet), and I have a small mortgage. I could borrow a little from family and friends to get by for a few weeks, maybe a couple of months, but one friend told me that since I used up all my savings to buy the house, I wouldn't be able to claim anything since it would be viewed as "deprivation of capital", particularly since the house is a bit bigger than what is absolutely needed, leaving the only option of selling the house for a much smaller place and living off the proceeds in the meantime until those are exhausted and then I could claim if i'm still out of work.

Any advice / comment is very welcome.

RAS

What rubbish.

Deprivation of capital is when you are on benefits and spend loads of money you have recieved to increase you chance of getting benefits. If you have only just been warned that you are going to lose your job, money spent prior to that does no count.

You need to be aware that you will have to pass the habitual residence requirement before you can claim benefits, and you have not been back in the UK long.

if the house is bigger than needed, can you get a lodger in (income tax free up to £370 per month).

DX2

I notice you haven't claimed child tax credits/working tax credits. Although you are going to be made redundant you should put in a claim for child tax credits.

Jowo_2

I'm not aware that a person has to be currently claiming benefits in order to come within the DoC rules. I would have thought any actions taken by those ahead of applying for them initially could also count. Remember that local councils can look back at people's property and capital changes they've made in the past way before they claim means tested benefits for their elderly care, for example. It is a complicated set of rules, though.

If you've not lived in the UK until very recently after a stint abroad, there's also residency rules for claiming means tested benefits. Hopefully another poster can give you pointers on them.

RAS

Jowo wrote: »

Remember that local councils can look back at people's property and capital changes they've made in the past way before they claim means tested benefits for their elderly care, for example. It is a complicated set of rules, though.

The OP is not looking for help with elderly care, where that do consider activity in the last 6 months.

WhiteHorse

joeking wrote: »

... one friend told me that since I used up all my savings to buy the house, I wouldn't be able to claim anything since it would be viewed as "deprivation of capital"...

Your friend is talking nonsense.

It would have been true if you'd bought another house on top of the one in which you live, or possibly true if the one you bought was an out-and-out mansion.

joeking_2

RAS wrote: »

What rubbish.

Deprivation of capital is when you are on benefits and spend loads of money you have recieved to increase you chance of getting benefits. If you have only just been warned that you are going to lose your job, money spent prior to that does no count.

You need to be aware that you will have to pass the habitual residence requirement before you can claim benefits, and you have not been back in the UK long.

if the house is bigger than needed, can you get a lodger in (income tax free up to £370 per month).

Thank you.

What is the habitual residence requirement ? And is there any rules about how to determine whether a house is bigger than required ?

joeking_2

DX2 wrote: »

I notice you haven't claimed child tax credits/working tax credits. Although you are going to be made redundant you should put in a claim for child tax credits.

I was told I couldn't claim that due to my income before I arrived back in the UK.

RAS

HRT info here http://www.parliament.uk/briefingpapers/commons/lib/research/briefings/snsp-00416.pdf not short or easy to read.

Mojisola

joeking wrote: »

I worked abroad for a few years, and when I moved back this September I bought a house, exhausting all my savings. I was initially still working for, and being paid by, my overseas employer, but I've just heard that I will be made redundant on 1 Dec with no redundancy compensation (that's another story).

As you bought the house before you knew about the redundancy, no-one can accuse you of deprivation of capital.

[Deleted User]

Jowo wrote: »

I'm not aware that a person has to be currently claiming benefits in order to come within the DoC rules. I would have thought any actions taken by those ahead of applying for them initially could also count. Remember that local councils can look back at people's property and capital changes they've made in the past way before they claim means tested benefits for their elderly care, for example. It is a complicated set of rules, though.

If you've not lived in the UK until very recently after a stint abroad, there's also residency rules for claiming means tested benefits. Hopefully another poster can give you pointers on them.

It cant be DofC if you were unaware of a redundancy,buying a house whilst not claiming benefits and unaware that you might have to is therefore NOT DofC