Can you deprive yourself of capital before receiving it?

Wanna_retire

If someone on means tested JSA/ESA/IS has £5000 in savings (ie not enough to affect their benefit) and spends most of it in the knowledge that they're soon to receive an inheritance that will take them over the £6000 limit, can that be considered to be "intentional deprivation"?

NASA_2

Yes, because you are still depriving yourself of capital in order to receive benefit, the fact that you were originally below the lower limit is irrelevant.

How much higher are you going to go though? Because if the total is less than £16,000 then you will still receive a decent amount of JSA. You are of course expected to use your capital to help you live.

Morglin

As long as you, at no point, are actually in reciept of money that takes you over the threshold, it won't affect anything.

You can spend your £5000 as you choose to, as you are under the limit.

However, if you do go over, when you get your inheritance, they need to be advised, and then the issue of 'deprivation of capital' would come into play, if you started to just spend it.

Lin

Wanna_retire

Morglin wrote: »

However, if you do go over, when you get your inheritance, they need to be advised, and then the issue of 'deprivation of capital' would come into play, if you started to just spend it.

Lin

Only from that point on, or, as Morglin suggests, retrospectively?

NASA_2

Would really help to know how much we are talking here.

Basically, as Morglin says, you can currently spend the £5000 however you wish because you dont have to declare it due to being beneath the limit. If however you spend that extravagantly, get £5,500 inheritance which would need to be declared, then they will start looking into what you had within the six months previous to receiving your inheritance and see that you may have wasted it in order to get more benefit.

rogerblack

NASA wrote: »

they will start looking into what you had within the six months previous to receiving your inheritance and see that you may have wasted it in order to get more benefit.

I don't recall any such provisions having looked through the DMG chapter 52 (esa/capital) several times.

While the case of claimants depriving themselves of a capital sum in order to get benefits is clear, and spelled out in the guidance, a key factor I do not see is that they can look past your capital immediately before you came into posession of the capital that took you over the limit.

To take it to an extreme, if this was allowable, the DWP would be able to use the notional capital rules on unreasonable daily living expenses (say taking taxis rather than busses) over a several year period which would make up a notional 6K capital sum, which would affect benefit.

airborne_61

What if someone was left say £75,000 in a will, could that person refuse the money, or would they
have to accept it?

airborne_61

The question still is would they still have to accept it?

NASA_2

Yes, they would, people are supposed to rely on their savings if they are above a certain level. Depriving yourself of that capital by not accepting it so that you can get benefit is exactly what the rules are there to prevent.

paddedjohn

Why have posts been removed from this thread? i read it last night and #3 told the op to spend as much as they could.

NASA_2

rogerblack wrote: »

I don't recall any such provisions having looked through the DMG chapter 52 (esa/capital) several times.

While the case of claimants depriving themselves of a capital sum in order to get benefits is clear, and spelled out in the guidance, a key factor I do not see is that they can look past your capital immediately before you came into posession of the capital that took you over the limit.

To take it to an extreme, if this was allowable, the DWP would be able to use the notional capital rules on unreasonable daily living expenses (say taking taxis rather than busses) over a several year period which would make up a notional 6K capital sum, which would affect benefit.

The point of notional capital is that people have deprived themselves of capital specifically to obtain benefit or to obtain a higher level of benefit.

If a DM decides that taking a taxi is extravagent, and can 'prove' that is the likely reason why taxis were used, then they are some kind of genius.

The scenario the OP is laying out is that he is just about to get an inheritance in the very near future. If that amount is £5,500 or more then the DWP are entitled to start asking for bank statements etc. to confirm the level of savings in an account(s). If those statements show large transations - or one large transaction then they are entitled to ask for receipts or details of what the money was used on.