Pensioner council tax benefit

mdavids

Hi all, not sure if I'm in the right forum but I'll go ahead and ask.

I've been speaking with my parents today and was amazed to learn they are paying full council tax despite only having a state pension and a quite small private pension as income. Although they aren't struggling badly they have to be more careful than they'd like to be with their money. I'd like them to be enjoying their retirement age rather than worrying about money

I had a google about and it seems that they are entitled to council tax benefit if their savings are below £16K. The benefit is something like £1K per year so well worth having however their savings are a few grand above the threshold.

My advice was to spend the money to take them below the threshold but there isnt anything they want to blow a few grand on however in a few years they'll probably end up below through spending on holidays and the like.

Is there any legit way of getting rid of this cash immediately, gifts to family etc or is the only option to blow it?

Thanks for any help,

uganda

mdavids wrote: »

Hi all, not sure if I'm in the right forum but I'll go ahead and ask.

I've been speaking with my parents today and was amazed to learn they are paying full council tax despite only having a state pension and a quite small private pension as income. Although they aren't struggling badly they have to be more careful than they'd like to be with their money. I'd like them to be enjoying their retirement age rather than worrying about money

I had a google about and it seems that they are entitled to council tax benefit if their savings are below £16K. The benefit is something like £1K per year so well worth having however their savings are a few grand above the threshold.

My advice was to spend the money to take them below the threshold but there isnt anything they want to blow a few grand on however in a few years they'll probably end up below through spending on holidays and the like.

Is there any legit way of getting rid of this cash immediately, gifts to family etc or is the only option to blow it?

Thanks for any help,

No, there isn't. There are plenty of things they can theoretically spend their money on and fall below the threshold and be fine, but the question is 'did they spend money in order to take advantage of the council tax benefit scheme?' They would then be treated as still having this money. It is all about their intention.

If their capital falls below the threshold just through natural spending, then they should claim. They should also apply for pension credit as they may be entitled to a small amount.

Oldernotwiser

If their savings are a couple of grand over the limit and their CT costs a grand, I would think that in two years their savings would be below the limit.

Itismehonest

If their income is low enough to qualify the fact that they have more than £16000 savings does not matter. They can still qualify under the income side.

Get them to ring the DWP & they will go through the figures with them.

mdavids

Of course eventually their savings will dip below the threshold. Obviously the sooner the better as far as I am concerned but he doesn't just want to waste money now that could be needed a few years down the line.

"the question is 'did they spend money in order to take advantage of the council tax benefit scheme?' They would then be treated as still having this money. It is all about their intention."

How could this be proved one way or the other? Say he spends a few grand on a new car. Who's to say this was done purely to get the benefit or if he did actually need a new car?

mdavids

Itismehonest wrote: »

If their income is low enough to qualify the fact that they have more than £16000 savings does not matter. They can still qualify under the income side.

Get them to ring the DWP & they will go through the figures with them.

I've done the calculations on the DWP website and it comes down to the savings, not their income. Basically if you have £16001 you get nothing, if you have £15999 you get approx 50% off your CT bill.

Itismehonest

If their income is less than a specified amount then they can receive Guaranteed Pension Credit. This allows for savings of more than £16000.
Under Guaranteed Pension Credit you are normally entitled to 100% CT relief.
But don't take my word for it - phone & find out.
It will, of course, depend on whether the income falls below the prescribed figure. £209.70 per week (if these figures are still correct)
http://www.pensioncredit.org.uk/

mdavids

Itismehonest wrote: »

If their income is less than a specified amount then they can receive Guaranteed Pension Credit. This allows for savings of more than £16000.
Under Guaranteed Pension Credit you are normally entitled to 100% CT relief.
But don't take my word for it - phone & find out.
It will, of course, depend on whether the income falls below the prescribed figure. £209.70 per week (if these figures are still correct)

He's going to ring up tommorow and find out. Their income is slightly more than the £277 which would entitle them to savings credit according to your link.

Thanks for your help.

creditcardhelp11

How is their health? If it is poor apply for Attendance Allowance and if awarded that would increase their income and also possibly give them PC (Guaranteed) entitlement.

mdavids

Their health is pretty good I believe. They've had the odd problem but nothing major/debilitating.

creditcardhelp11

Well I hope that continues but bare it in mind for the future.