inheritance whilst claiming housing benefit

col608

My Father unfortunately passed away unexpectedly the week before Xmas last year leaving my Mother widowed at 61. They both worked hard all their lives but never amassed savings or property and were claiming pension credits and housing benefit.
My Mother however, has just received a life insurance policy for my Father that amounts to £100,000 and the benefits agencies have notified her that she is to inform them of any inheritance.
I am aware that any 'savings', in excess of £16,000 will affect housing benefits etc and that as a result, her benefits will now stop and she will be forced to use the money for rent etc, as opposed to being able to use the money as she or my Father would have wished. Inevitably in 5 or 6 years she would undoubtedly therefore be penniless once again.
Is there any way my Mother can hide or lose this money so as to enjoy it after the loss of her husband and still claim housing benefit, instead of using it to struggle by as she has all her life?
What would happen if my Mother supposedly acted upon my Fathers wishes to share the money between the family and divide £30,000 each between myself, my sister and £10,000 to each of the two grand-kids as gifts from my father? We could then set the money in bank accounts for Mum to use as necessary..........??? What if my Mum supposedly gives £84,000 to me as if she owed it to me for something and i put it in an account for her again to use as necessary?

hcb42

did your father leave a willing stating this money to be shared oult like this?

Otherwise, very risky, but you have to remember why we have insurance..

col608

No the will stated that everything is to be left to my Mother

Torry_Quine

No she can't give it away or hide it. £100,000 is a lot of money and I am incredulous at your suggestions. The money will should be used to make her life a bit more comfortable which is surely what your father would have wanted.It would be deliberate deprivation of assets.

My condolences for your loss.

[Deleted User]

Can she not buy her a property? I'm unsure where in the Country you live but could get a reasonable property in Notts for 100k

col608

My Mother lives in Cornwall where properties are fairly expensive. She could purchase a retirement bungalow i guess?..... Are there any benefit problems then??

iamana1ias

col608 wrote: »

My Mother lives in Cornwall where properties are fairly expensive. She could purchase a retirement bungalow i guess?..... Are there any benefit problems then??

Someone with £100k in the bank DOES NOT NEED BENEFITS! :mad::mad:

cassieB57

How would she be 'struggling' on 100K after having managed on benefits up to now? And why would you be trying to encourage her to commit fraud? Is that what your dad would have wanted?

seven-day-weekend

She cannot claim means-tested Benefits while she has more than £16k in savings. Disposing of, hiding, or giving away unreasonable amounts will almost certainly be classed as deprivation of capital and she still will not be entitled to the Benefits. Spending reasonable amounts on improving her home or a modest car would probably not be classed as deprivation.

What is the money supposed to be for, other than to make her life more comfortable? Why would she want means-tested benefits under these circumstances?

Most of us have worked hard and most of us don't have £100k in the bank, your mother is very fortunate to have this.

I too would suggest buying a place outright, then she won't have to pay any rent.

col608

It seems having looked further in to it that if she doesnt declare the inheritance she will be prosecuted for benefit fraud. (And quite right too!) So therefore as she has an inheritance over £16k her housing benefit and council tax benefit will be stopped and she will have to use her inheritance to pay her rent and council tax until the 'savings' reach the £16k threshold.
If she spends the money at a rate that is in excess of her usual spending patterns then this is deprivation of capital and she will be in trouble with the government still. (even purchasing a new car or furniture).
If she gives it away to children or put in trust for grand children...again, deprivation of capital.
If she purchases a house (probably a small retirement caravan for £100k in Cornwall) her standard of house will be significantly less than now as a result of getting the inheritance.
She is too old to obtain a mortgage.
So what is the point of my Dad paying into this life insurance policy in the first place? £70 per month for years in order that my Mum can have money she cant spend... ...or, alternatively she can purchase a caravan to live the remaining years of her life in! Thats what im saying.

cassieB57

col608 wrote: »

It seems having looked further in to it that if she doesnt declare the inheritance she will be prosecuted for benefit fraud. (And quite right too!) So therefore as she has an inheritance over £16k her housing benefit and council tax benefit will be stopped and she will have to use her inheritance to pay her rent and council tax until the 'savings' reach the £16k threshold.
If she spends the money at a rate that is in excess of her usual spending patterns then this is deprivation of capital and she will be in trouble with the government still. (even purchasing a new car or furniture).
If she gives it away to children or put in trust for grand children...again, deprivation of capital.
If she purchases a house (probably a small retirement caravan for £100k in Cornwall) her standard of house will be significantly less than now as a result of getting the inheritance.
She is too old to obtain a mortgage.
So what is the point of my Dad paying into this life insurance policy in the first place? £70 per month for years in order that my Mum can have money she cant spend... ...or, alternatively she can purchase a caravan to live the remaining years of her life in! Thats what im saying.

To give her a comfortable standard of living after he's gone so she DOESN'T need to survive on benefits perhaps? Why is it money she "can't spend" though?