reducing savings to the £16,000 threshold

karenx

There is no reasonable way to spend it apart from using it for day to day living and keep receipts and bank statements to prove what you have spent it on and they will decide if what you used it on was reasonable.

viktory

bertietheblue wrote: »

Thanks, tcr - that's all I wanted. Not all these judgements.

No what you wanted, like so many on here these days, is a 'workaround' of the benefit rules so that you might claim the tax payers money and keep your own tucked under the mattress.

HappyMJ

You could always go on holiday spend loads have fun come back and claim.

Mojisola

HappyMJ wrote: »

You could always go on holiday spend loads have fun come back and claim.

If you do, you'll most likely be assessed as if you still have the money and still won't get benefits.

Incyder

Its a tough one. I think 25k is such a nice lump it would be a shame just to get rid of 9 as if it doesnt matter much. It does, its a big amount.

Once under 16k and claiming you will find its not a bed of roses. Your benefits will be reduced greatly anyway as you will lose £1 a week for every £250 you have over 6k but under 16k.

You are at the mercy of the jc and their decision making and all the pit falls of their mistakes. They can pressure you in all sorts of ways you can't even imagine yet. It's no fun, I did it for a few years but never want to back.

The best thing you can do is clear your loan off or you may never do it. That will leave 13k. I would try and use this whilst looking for a job or making one via a self employment skill you may have.

If you don't improve your life with the money then its a waste of time having it.

The job centre is full of claimants with nothing, absaloutely nothing, like chickens scratching around in the dirt looking for that last grain of corn that just isn't there.

Your 25k means you don't need to be like that.

HappyMJ

Mojisola wrote: »

If you do, you'll most likely be assessed as if you still have the money and still won't get benefits.

Why would that be? Aren't people who are working entitled to a holiday the OP works and will be working until October so should be able to spend loads between now and April 2012 which is the 6 month point after a CB JSA claim. I'd pay the loan down quicker than you are doing now so that when you get your redundancy payment you can just use it to pay off normal day to day bills with it.

Jowo_2

bertietheblue wrote: »

Ah, "they that judge". But, you know, I have no time for the righteous disapproval of those who are ignorant of me and my full circumstances - strangers to boot! Anyone can go to bed smiling smugly, imagining the round of applause that never was. I find that wretched.

All I ask is can anyone provide an understanding of how the system works - never been unemployed, and, who knows, may not be come October?

Thanks alot
Bertie

Your full circumstances are irrelevant even if they are worthy of a violin - the strangers, smug or otherwise, at the DWP and HMRC can and will investigate a claimant's expenditure to determine if they have deliberately deprived themselves of capital and if they believe they have found grounds for this, will apply notional capital and treat the claimant like they still have that money and refuse them means tested benefits and allowances.

Search for 'deprivation of capital' and 'notional capital' on this forum as there have been a number of threads recently. In them you will find a link to the DWP and HMRC decision makers guide which are the staff manuals that provide an explanation of how they identify Deprivation of Capital. That way you will understand what is classed as acceptable and unacceptable spending.

Early repayment of a loan where there is no legal obligation to pay it off early has a strong likelihood of being classed as DoC.

HappyMJ

Jowo wrote: »

Your full circumstances are irrelevant even if they are worthy of a violin - the strangers, smug or otherwise, at the DWP and HMRC can and will investigate a claimant's expenditure to determine if they have deliberately deprived themselves of capital and if they believe they have found grounds for this, will apply notional capital and treat the claimant like they still have that money and refuse them means tested benefits and allowances.

Search for 'deprivation of capital' and 'notional capital' on this forum as there have been a number of threads recently. In them you will find a link to the DWP and HMRC decision makers guide which are the staff manuals that provide an explanation of how they identify Deprivation of Capital. That way you will understand what is classed as acceptable and unacceptable spending.

Early repayment of a loan where there is no legal obligation to pay it off early has a strong likelihood of being classed as DoC.

So what you are saying is if the OP pays off the loan now then by April 2012 when he'll be entitled to the income based benefits the notional capital would have been reduced to zero due to the time that has passed between now and then. As far as I understand...

Mojisola

HappyMJ wrote: »

You could always go on holiday spend loads have fun come back and claim.

HappyMJ wrote: »

Why would that be? Aren't people who are working entitled to a holiday the OP works and will be working until October so should be able to spend loads between now and April 2012 which is the 6 month point after a CB JSA claim. I'd pay the loan down quicker than you are doing now so that when you get your redundancy payment you can just use it to pay off normal day to day bills with it.

If you went on the kind of holiday that you normally had, you could argue that it was reasonable. The DWP could also argue that, as you knew of the redundancy, you should not have been continuing to spend as you did before. If you go on a very expensive holiday and "spend loads", you're unlikely to get that past the DWP.

It doesn't matter how sensible it seems to pay off a loan faster than necessary, if you want to claim benefits, you have to comply with the rules and the rules say that this would be deprivation of capital.

Jowo_2

HappyMJ wrote: »

So what you are saying is if the OP pays off the loan now then by April 2012 when he'll be entitled to the income based benefits the notional capital would have been reduced to zero due to the time that has passed between now and then. As far as I understand...

Can't say I'm an expert in this area. We could do with a DWP or HMRC DM on this forum to be honest, as DofC is very complex.

Some people on this forum have argued that its okay to pay off loans way ahead of making an application for means tested benefits, they seem to think that the DWP/HMRC will only look at the previous 3 months of bank statements, therefore aren't concerned about financial actions before that date. Others argue that the 3 months of bank statements that the authorities request when a person applies for certain benefits don't actually mean there is a window of opportunity before this date to pay stuff down and hammer through their savings.

I've browsed through some of the Decision Makers guides on deprivation of capital and while I find it vague about their attitude to paying off actual debts, there are references that suggest the early repayment of loans where there is no legal requirement to pay them off ahead of time is seen in a negative light.

I think this is to discourage people from paying off loans, including mortgages, early and then applying for means tested benefits.

But the Decision Makers guides offer some information about how the staff calculate notional capital so the OP should look at this. I don't know how/when they start the clock on this.