On benefits and big inheritance - advice agencies?

Alter_ego

dmg24 wrote: »

Ames, given that you know what you want to do, you could write to the DWP and ask them for written permission as to which of your plans are acceptable/ within the capital deprivation rules. Then you know there will be no comeback afterwards.

dmg24, Could you explain how this differs from my advice to declare it?

Ames

Thanks Lin, I've got to spend this weekend catching up with paperwork, then I'll have a better idea of where I'm at with everything and I'll try and phone them on Monday.

33degrees

The critical question the opening poster needs an unequivocal answer to from the DWP, rather than from anyone else, is whether buying a property will be viewed by them as deprivation of capital. Its price, the cost of furnishing and making adaptions to it and its size are secondary because if they take the view that he already has a secure abode and therefore it is unnecessary for him to purchase any property to live in then he'll shoot himself in the foot big time as they'll assume he still has the money that he plans to spend.If he was currently homeless because of, let's say, an unfortunate set of circumstances, then it would be very unlikely that they'd view buying a place in a negative light.The OP obviously realises that the residue of his inheritance over and above the capital and savings thresholds for the means tested benefits he is in receipt of will slowly disappear via, amongst other things, paying full rent and CT for donkey's years.I would advise him to discover who to write to at the DWP who will give him a definitive answer in writing and to then get scribbling immediately.Assuming his savings will amount to exactly £60k shortly, if I was him I'd look to buy an unfurnished two-bedroom house for circa £45K and estimate that moving/conveyancing fees at £2K and another £8k for furnishings and adaptions and include those figures in any correspondence.

Ames

I'm a she, but other than that thanks for your post!

The problem with writing with figures is that I just can't know the full costs. Would it still be ok for me to write to get permission to buy a house in principle and say that I'll confirm actual details when I know them? I'll have a think this weekend about wording and then post it up here for people's opinions.

Something else I've just thought of, I'm responsible for the funeral costs as the rest of the family were estranged from her, I've borrowed the money from my dad, will it be ok to pay him back before the estate is split? And her debts? From the DWP POV I mean.

Mojisola

Paying for the funeral is the first call on the deceased estates so, yes, you can take the money you have "loaned" the estate by paying for the funeral upfront.

The funeral costs and repaying any debts have to be sorted out first. The estate consists of whatever remains after these have been paid.

You need to double-check with the DWP that there hasn't been any overpayment of pensions and/or benefits. You don't want them asking for money to be repaid after you've given distributed the estate.

Ames

We've contacted the DWP about it, my sister was given a form to give to them when she registered the death. We've also been in touch with the IR, and because of when she died she wont owe them anything, although they may owe us something (I think I may frame that letter, I doubt many people get them!).

Her bank account was frozen on the first working day after her death, so as benefits are paid in arrears there shouldn't be an overpayment - as no payments could have been made after her death.

She was too young for a pension

RAS

Ames wrote: »

She was too young for a pension

Ahh Ames, so sorry for you all.

And yes, the costs of the funeral and any other debts have to be paid from the estate before you report probate.

Basically, what mum left minus (the costs of the funeral + any other debts)= the estate fro probate purposes.

Have you been advised to advertise for creditors? That prevents you getting some DCA crawling out of the woodwork after probate has been granted demand you pay for a long lost credit card that is not yet statute barred. based od a few post of DFW, DCAs routinely trawl probate registers for any estates that might owe them money.

Once the advertised date for claims is up, you are protected from late notiofication of debt.

Have you read all the utility meters, by the way?

33degrees

Ames wrote: »

I'm a she, but other than that thanks for your post!

The problem with writing with figures is that I just can't know the full costs. Would it still be ok for me to write to get permission to buy a house in principle and say that I'll confirm actual details when I know them? I'll have a think this weekend about wording and then post it up here for people's opinions.

Something else I've just thought of, I'm responsible for the funeral costs as the rest of the family were estranged from her, I've borrowed the money from my dad, will it be ok to pay him back before the estate is split? And her debts? From the DWP POV I mean.

Apologies for the wrong assumption on the gender front.I don't wish to worry you but it must be said you are about to traverse a minefield and must tiptoe through it very carefully or suffer much angst. As I said, you must get the okay in writing as evidence before embarking because if you don't get that green light on the principle, as you termed it, then trying to tiptoe around it will land you with many problems should you gift your wealth away and/or employ other dodges that so many have been punished for previously.If no thumbs-up is forthcoming then you'd be wise to suck it up, as Americans are fond of saying, however painful and maddening that would be as it would still be better than the alternative because the DWP investigators are quite ruthless once they are on the scent.Should you get permission that it's alright to proceed then the very instant that the money appears in your bank account you'd have to withdraw your claims for Housing Benefit, Council Tax Benefit and any other means tested immediately and not make new claims for any means tested benefit until you can demonstrate you have less than the thresholds. I used those numbers previously to take you below 6K and with property prices and the associated costs you would incur wouldn't be unreasonable given the median house prices in Leeds.Regarding repaying money loaned by your father, that's another possible pitfall because if he loaned it with cash there's no electronic record.In future, make absolutely sure that you pay for practically everything you can with a cheque or plastic card so that transactions can be proved rather than only your say so. That's not meant to be mean it's just life will be so much easier that way.So, in conclusion, make sure you attain the correct name, title and business address of a DWP person who has the authority to give you a yay or nay, give a brief outline of how much you anticipate receiving and what you envisage the approximate costs of buying a home and adapting it for suitabilty (plus the extra costs already mentioned) and ensure you pay for the letter to be tracked so that you know it's arrived.Whether the proceeds are received before getting a reply or not then you'd still have to withdraw claims for means tested claims.PS Have no clue why I'm unable to make paragraphs here.

33degrees

Ames wrote: »

Thanks Lin, I've got to spend this weekend catching up with paperwork, then I'll have a better idea of where I'm at with everything and I'll try and phone them on Monday.

Try a letter like below. (Only with paragraphs, argh!)Dear Sir/Madam,I write to you as I am seeking guidance with regard to your agency's rules concerning deprivation of capital because I am somewhat confused and hope that you may be able to offer me clear advice as to whether my plans would be acceptable.To be as concise as I am able: my mother died quite recently and I understand that when her estate is settled then I can expect to receive a cheque to the sum of somewhere in the region of sixty thousand pounds as my share of the inheritance.I currently live in rented social housing accommodation and am in receipt of several different benefits, some of which are means tested.I would dearly like to purchase outright another property for I and I alone to live in - one that I believe would be more suitable to my needs - that together with the associated expenditure of moving and legal fees, etc, I anticipate would cost in excess of fifty thousand pounds.Would I be able to without my actions being deemed as deliberate deprivation of capital should I, in the months or years ahead, make a claim or claims for means tested benefit(s) that I would otherwise qualify for?

Mojisola

33degrees wrote: »

Try a letter like below. (Only with paragraphs, argh!)Dear Sir/Madam,I write to you as I am seeking guidance with regard to your agency's rules concerning deprivation of capital because I am somewhat confused and hope that you may be able to offer me clear advice as to whether my plans would be acceptable.To be as concise as I am able: my mother died quite recently and I understand that when her estate is settled then I can expect to receive a cheque to the sum of somewhere in the region of sixty thousand pounds as my share of the inheritance.I currently live in rented social housing accommodation and am in receipt of several different benefits, some of which are means tested.I would dearly like to purchase outright another property for I and I alone to live in - one that I believe would be more suitable to my needs - that together with the associated expenditure of moving and legal fees, etc, I anticipate would cost in excess of fifty thousand pounds.Would I be able to without my actions being deemed as deliberate deprivation of capital should I, in the months or years ahead, make a claim or claims for means tested benefit(s) that I would otherwise qualify for?

I wouldn't put this in. If Ames is able to get a two bed house for the money, she may want to rent out a room or have a relative come to live with her.