Inheritance affecting benefits and deprivation of capital...

cparry

Hi,

Can anyone help?

My partner will finally be getting inheritance money (after a year's wait) but has today found out that it will be for £25,000.

Me, my partner and our 1 year old daughter live in a council rented property and currently have housing and council tax benefits. We also have income support, child benefit, child tax credit and my partner claims DLA. We are marrying in February 2012.

I am the only perosn who can drive but we recently had to scrap our vehicle as the repair was too costly.

We do not want to do anything wrong when we finally get the inheritance money. We will be informing DWP about this and are expecting to lose our IS and CB entitlements. We will also lose our housing benefit and council tax benefit but we believe my partner's DLA will not be affected as it is not means tested.

We urgently need a new vehicle and we would like a holiday after the wedding. We have never been on holiday for the 3 years we have been together. My partner has had a lot of health problems since giving birth, we both had to have stresses of moving property a few weeks after our daughter was born. My partner lost her father (hence the inheritance monies) in the last year, having lost her mother 6 years ago too.

All we want to do is have a car and a holiday without us breaking any rules or laws. We do not want to use the inheritance monies for anything else. Will we allowed to do this? What's our best form of action? Our main concern is that when the inheritance finally gets to below the £6,000 threshold in a few years after having used it to pay rent, council tax, bills, etc (that we would have normally paid for with the benefits) - having bought a car and a hoilday - will this prevent us from getting benefits in the future?

We need to know exactly what we can and cannot do in black and white. We do not want any maybes as we do not want any trouble with the law, government, DWP or benefits office etc

Any help greatly appreciated.

Thanks
Craig

paddedjohn

as long as you dont go on a world cruise and buy an expensive sports car i would think you would be ok

Mikazaru

Even after a holiday and a car you'll still have over £20,000 left so with the DLA, CB and CTC it would take a fair while until you'd be entitled to benefits again, if you keep receipts for large purchases and don't spend it unnecessarily when that time comes it should be fine. Would you not be in employment by then so it won't matter?

Morglin

You need to ask them, as there appear to be no hard and fast rules.

From experience, I would say (although can't guarantee), that buying an essential car and paying off debt is seen as ok, but holidays generally aren't.

But, check with them - if you spend money on something they don't 'agree' with, you can be classed as still having the assets, even once it is spent.

It would be easier if there were hard and fast rules, but this system seems to work on DWP/council discretion.

Lin

kingfisherblue

Paying off debts is not normally seen as ok, unless payments are overdue. A reasonable family holiday is often counted as okay though.

t0rt0ise

You won't have to wait until you have less than £6,000 to reclaim housing benefit and so on. The savings limit is £16,000 although a little will be taken off for some of the savings. I don't know the thresholds for other benefits.

easy

Mikazaru wrote: »

Even after a holiday and a car you'll still have over £20,000 left so with the DLA, CB and CTC it would take a fair while until you'd be entitled to benefits again, if you keep receipts for large purchases and don't spend it unnecessarily when that time comes it should be fine. Would you not be in employment by then so it won't matter?

Erm, no experience of the benefits aspect of this, but frankly if I needed to buy a car, and hadn't had a holiday for several years, I would be spending more than £5K in total on these 2 things.

Surely, there is NO point in the OP buying a crappy old banger, which will cost him a fortune in repairs over the next 2 years .... If I came into £25k, I would be looking at £5k or so for a decent 3 or 4 year old vehicle.

Bogof_Babe

Are either of you looking for work? I'd have thought one of you would be expected to, leaving the other one free to care for the child.

salau2

cparry wrote: »

Hi,

Can anyone help?

My partner will finally be getting inheritance money (after a year's wait) but has today found out that it will be for £25,000.

Me, my partner and our 1 year old daughter live in a council rented property and currently have housing and council tax benefits. We also have income support, child benefit, child tax credit and my partner claims DLA. We are marrying in February 2012.

I am the only perosn who can drive but we recently had to scrap our vehicle as the repair was too costly.

We do not want to do anything wrong when we finally get the inheritance money. We will be informing DWP about this and are expecting to lose our IS and CB entitlements. We will also lose our housing benefit and council tax benefit but we believe my partner's DLA will not be affected as it is not means tested.

We urgently need a new vehicle and we would like a holiday after the wedding. We have never been on holiday for the 3 years we have been together. My partner has had a lot of health problems since giving birth, we both had to have stresses of moving property a few weeks after our daughter was born. My partner lost her father (hence the inheritance monies) in the last year, having lost her mother 6 years ago too.

All we want to do is have a car and a holiday without us breaking any rules or laws. We do not want to use the inheritance monies for anything else. Will we allowed to do this? What's our best form of action? Our main concern is that when the inheritance finally gets to below the £6,000 threshold in a few years after having used it to pay rent, council tax, bills, etc (that we would have normally paid for with the benefits) - having bought a car and a hoilday - will this prevent us from getting benefits in the future?

We need to know exactly what we can and cannot do in black and white. We do not want any maybes as we do not want any trouble with the law, government, DWP or benefits office etc

Any help greatly appreciated.

Thanks
Craig

What rates of DLA is your partner claiming? If it is Middle or Higher Rate Care you may be able to claim Carer's Allowance which is not affected by savings.

rogerblack

easy wrote: »

Erm, no experience of the benefits aspect of this, but frankly if I needed to buy a car, and hadn't had a holiday for several years, I would be spending more than £5K in total on these 2 things.

The fun part of this is notional capital!
Notional capital is magic money that the DWP say you have, after spending on items they don't approve of.

This capital affects your benefits.
If you blow 20K on a really awesome holiday to disneyworld for you and your family, then the DWP may treat you as if you still had that 20K.
And you will not be due any benefits.
This notional capital does not stay around forever, but it's reduced by the amount of benefit that would have been paid in the absence of the capital.

Another fun part is that the different benefit departments don't link this up.
So, if you're paid 1K council tax benefit a year, and 5K housing benefit, after a year, your housing benefit 'notional capital' would be 15K, but the council tax still 19K.
Similarly for other benefits.

This is why people are suggesting not to spend too much.

However. You can ask the DWP for prior approval on your plans.
If this is given, they can't then come back at you and change their minds.

easy

rogerblack wrote: »

The fun part of this is notional capital!
Notional capital is magic money that the DWP say you have, after spending on items they don't approve of.

This capital affects your benefits.
If you blow 20K on a really awesome holiday to disneyworld for you and your family, then the DWP may treat you as if you still had that 20K.
And you will not be due any benefits.
This notional capital does not stay around forever, but it's reduced by the amount of benefit that would have been paid in the absence of the capital.

Another fun part is that the different benefit departments don't link this up.
So, if you're paid 1K council tax benefit a year, and 5K housing benefit, after a year, your housing benefit 'notional capital' would be 15K, but the council tax still 19K.
Similarly for other benefits.

This is why people are suggesting not to spend too much.

However. You can ask the DWP for prior approval on your plans.
If this is given, they can't then come back at you and change their minds.

Thanks, I know nothing of this, having never been in the situation myself.

But who decides what is allowable or not? Do DWP staff have a prescribed list, or is it down to you own advisor or office manager? As I say, as someone who knows a little bit about cars I would tend to spend more on a decent recent model, as that tends to mean you'll spend less on maintenance (and as the OP has a disabled wife, a reliable vehicle should be a priority), but I can see some DWP jobsworth who doesn't understand the logic getting snotty about that.


So if I owned a house with a leaking roof, was on benefits, but happened to come into some money, would I have to ask DWP if I was allowed to mend the roof ??