Inheritance + CT/HB Pension Credit

Mojisola

Pollycat wrote: »

Neither is reading the booklet that comes with your pension credit letter that tells you very very clearly what change of circumstances you need to tell DWP about - the notifiable changes differ depending on whether you have an AIP or not.

Despite reading the booklet, my parents were very worried about the inheritance and were frightened to spend it in case they were asked to repay benefits in the future. Having the letter has reassured them that they aren't doing anything wrong.

Pollycat

Mojisola wrote: »

Despite reading the booklet, my parents were very worried about the inheritance and were frightened to spend it in case they were asked to repay benefits in the future. Having the letter has reassured them that they aren't doing anything wrong.

I do appreciate that, Mojisola, but my Mum doesn't read stuff from the DWP and council, she has difficulty in taking it in.
So I do it for her.

They were exactly the same after receiving the money from their house sale after moving into council-owned, warden-controlled senior people's accommodation.

As I've said already on this thread (post #40):

Pollycat wrote: »

About 6 years ago Mum & Dad moved into council-owned, warden controlled senior people's accommodation and put their house up for sale (old terrace).

They were in receipt of Savings Pensions Credit at the time and the day they received the money from the house sale, I phoned up DWP to report the change in circumstances.

A few months later, I noticed they were still being paid Savings PC so I rang up again and the guy said that as they had an assessed period, any change in their savings did not affect their entitlement to Savings PC.
He actually said 'even if they win the lottery they will still get Pension Credit until the end of the assessed income period'.

So, yes it would seem that in some circumstances you can continue to claim benefits even if you've won on the lottery.

As soon as that cheque from the solicitors dropped onto the doormat, they had their coats on and we were on the way to the local council offices and I had to ring DWP for them that very day.

I still have on file my record of the conversation:

Rang Pension Service 8/2/06. The assessment lasts for a set period of time and regardless of how much their financial circumstances change "even if they win the lottery", they get paid the agreed amount AND WILL NOT HAVE TO PAY BACK ANY AMOUNT RECEIVED UP TO THE NEW ASSESSMENT. The assessment ends Oct 2006, so the £xx per week being paid is really due to them. I assume in October 2006, the Pension Service will get in touch with them to complete a new claim.

To me, the booklet is very clear and Mum trusts me to do what is necessary.

If the booklet says we need to advise DWP because a specific change of circumstances has occurred then that's what I'll do.

If it says we don't need to advise them about a specific change of circumstances, then I won't.

Mojisola

Pollycat wrote: »

I do appreciate that, Mojisola, but my Mum doesn't read stuff from the DWP and council, she has difficulty in taking it in. So I do it for her.

If it says we don't need to advise them about a specific change of circumstances, then I won't.

rachyroundbum wrote: »

I would like to clarify that my dad is happy to pay his rent and his council tax, I was just enquiring because he didn't want to spend ANY of it at all, incase he was forced to spend it all on those outgoings.

Pollycat - it's good your Mum trusts you to get it right. When saying about the letter reassuring my parents, I had in mind the OP's Dad who sounds as if he needs clarification about his position.

Pollycat

I too think the OP's Dad needs to be 100% sure about what changes in circumstances he should advise DWP about.

It would be helpful if we knew if he had an assessed income period.

dodger1

rachyroundbum wrote: »

Right, let's get one thing straight.

HE HAS NO INTENTION OF CONTINUING TO CLAIM BENEFITS ONCE THE PAYMENT COMES THROUGH. THAT WASN'T WHAT I WAS ASKING, AND I DIDN'T SAY THAT IS WHAT HE WANTED TO DO.

The question, if any of you bothered to read the OP was would the government FORCE him to spend it ALL, EVERY LAST PENNY, on ct and rent, with no room to spend?

For example, if I was unemployed and having ct and hb paid for me, and I got a job, I would pay my council tax and rent out of my wages. I would then have x amount left to spend on what I want. Will my dad be allowed to pay the ct and rent and have, say £100 left over each month to spend on what he likes? It may be more, it may be less, but will he be able to allocate himself money, AFTER he has paid the ct and rent HIMSELF to spend on what he wants each month? OR WILL HE BE FORCED TO SPEND EVERY LAST PENNY ON NOTHING BUT RENT AND COUNCIL TAX. To simplify it some more, if he got £30,000 inheritance, would he be forced to spend exactly £30,000 over x amount of year ONLY on ct and rent?

That was the question, it was very simple if anybody bothered to read the OP.

Actually this is different to your original post as you've now given more information. Personally I'd still claim everything I could although the inheritance would certainly lessen the amount of pension credit. If the pension credit became zero because of the inheritance and your mother's p/t job then the other benefits may go as well.

As far as spending the inheritance is concerned, there is nothing wrong in purchasing a reasonably priced second hand car every few years and having a reasonably priced holiday every year if they want. Normal living is not deprivation of capital and if savings decrease by a reasonable amount each year which increases the amount of pension credit paid then the pensions people aren't worried.

Each year I have to supply the pension people proof of my current savings and the figure reduces each year by a sensible amount and doesn't get queried. They do actually accept that you can spend some of your own money on enjoyment.

Whiteknight

Pollycat wrote: »

I too think the OP's Dad needs to be 100% sure about what changes in circumstances he should advise DWP about.

It would be helpful if we knew if he had an assessed income period.

Unlikely an AIP would have been set as the OP's mother is working part time so the income coming into the household is not stable.

manglesey25

rachyroundbum wrote: »

Hi,

My dad is due to recieve an unknown sum in inheritance (it's currently unknown because the debt of the estate is still being paid). He lives with my mum, who works part time, and they are in receipt of Council Tax benefit, Housing Benefit and pension credit.

They are under the impression that the Government will FORCE them to spend whatever my dad receives in inheritance on council tax and housing benefit, with no room for him to "enjoy" the money.

They never force anyone to spend money, no different to giving it away. If a claimant has a certain threshold of liquid capital then they lose benefits. I dont know what the threeshold is, but Im sure a DWP advice line can tell you.

rachyroundbum wrote: »

Is this true? Will they have no control over what they spend? After the death of his mother, and ongoing illness on his side, he basically just wants to freedom to book a mediterranean cruise, buy a decent second hand car and buy half a caravan with his sister (an absolute total cost of £15,000) and a new fridge.

Look at the Will, in particular in the General Provisions section: Does it say: "A Person may disclaim his interest under the Settlement wholly or in part." or the gift clause says something like "to hold upon trust for NAME the sum of £xxxx" as opposed to "I give and bequeath to NAME £xxxxx" or "I direct my trustees to make over to NAME the sum of £xxxx" etc .

If so, ask the trustee to hold the legacy upon trust for the beneficiary. Its an administrative power under the 1925 Trustee act, and the beneficiary can ask for an advancement from time to time, but cannot be coerced by anyone to forcefully make an advance.

rachyroundbum wrote: »

I have read online that there is a loophole - basically because he didn't know he was going to receive that sum of money it would be treated the same as a lottery win???

Theres no loophole, its the law and trustees are usually allowed to hold legacies as they think fit.

rachyroundbum wrote: »

Any clarification is appreciated, I hope I have supplied enough information for those in the know.

Bottom line, I would need to read the actual wording of the Will to give the difinitive answer.