Retired couple on benefits. Inheritance issue.

bigmondy

:huh:Retired couple in their 70's living in a council house on benefits and reasonably happy with their lot.

They have just been left a 2 bedroom house in a state of serious disrepair 300 miles away in a remote Scottish Island.

They havent a clue what to do and I am at a complete loss to advise them what is best apart from telling them to go to their local council office and declare it. I reckon he woudl have done that anyway - straight up ex-forces type.

They were also left £20k - however the poor old bloke (really nice man - not sure about his Mrs dont know her that well) hasnt a clue what to do as it (by the looks of it) needs 3 times that much spent on it to just make it habitable.

I told them I would ask on here - what guidance would you give?

themull1

If the house doesnt have a mortgage on it, can it not be sold.?

HappyMJ

Sell the property at auction and get whatever you can for it.

Do they get pension credit? If so, then the capital they have come into doesn't matter.

Spend it on living and maybe a holiday and enjoy.

lilac_lady

Sell the house and buy a comfortable retirement without benefits,

bigmondy

Thanks guys - No mortgage. Should have specified that.

I did suggest selling - however it has been in the family for over 80 years and he seems determined to pass it on to his kids.

BigAunty

If they transfer ownership of the property to their children, they can end up being treated as if they still own it and it will still affect their means tested benefits. Find the DWP 'deprivation of capital' decision makers guides to understand about the rules.

These are essentially DWP staff manuals but this also helps recipients of capital to understand why they can't simply gift their capital/savings away to others and expect to continue to receive housing benefit, council tax rebate and so on. 'Notional capital' is where the DWP will treat the person as if they still have their assets even if they've got rid of them.

Also, try to find the HB regulations online as they do contain a section for those claiming HB who own but do not occupy a property elsewhere.

Far better for you to find documents and guidance from the authorities than depend on opinions on a forum.

bigmondy

Excellent advice BigAunty, I guess that the fact the house is actually going to lie empty until they can completely gut it and will end up costing the family to do so - he reckons over a year with family helping out. I suppose ultimately he could then decide what to do.

Phoned him to discuss comments on this thread and he is off down to the DSS office as we speak so I guess they will guide him accordingly.

I get the distinct impression that it is the immediate future he is worried about, council tax, upkeep, bills, keeping the building heated, then loosing his benefits at the same time.

Its a toughy.

lovetowinacar

bigmondy wrote: »

Excellent advice BigAunty, I guess that the fact the house is actually going to lie empty until they can completely gut it and will end up costing the family to do so - he reckons over a year with family helping out. I suppose ultimately he could then decide what to do.

Phoned him to discuss comments on this thread and he is off down to the DSS office as we speak so I guess they will guide him accordingly.

I get the distinct impression that it is the immediate future he is worried about, council tax, upkeep, bills, keeping the building heated, then loosing his benefits at the same time.

Its a toughy.

For his immediate future council tax etc he can use some of the £20,000 he also inherited. Could he perhaps sell the house in Scotland to his family - not sure of value etc etc. He is now in the lovely position of not being in the vulnerable position of requiring the safety net of the welfare state and so can now provide for himself and his wife - hopefully he will enjoy his inheritance.

bigmondy

lovetowinacar - that is exactly the point I am trying to accentuate to him. But he is very nervous about the fact that the money wont even look at the repairs - so he will in effect be worse off because he is losing his benefits.

Incidentaly the estate was bequeathed to him 6 months ago but the £20k was only transfered last week from the lawyers - good grief I have just had a horrible thought. Does this mean he has to pay back his last 6 months benefits? eek

sleepless_saver

bigmondy wrote: »

I get the distinct impression that it is the immediate future he is worried about, council tax, upkeep, bills, keeping the building heated, then loosing his benefits at the same time.

Its a toughy.

The truth is that if they keep the house it will be a continuing worry not just a problem in the immediate future, even if sentiment stops them seeing this.

Houses in remote Highland and island areas are difficult and expensive to maintain and heat, and it's not like they can pop in and check on it. As it's already in serious disrepair, their £20k won't go far if they are thinking about getting it put to rights.

If the "kids" they want to leave it to could convince them parents that they don't want the house, perhaps they could be persuaded to sell (auction could be simplest). As well as the next assessment for pension credit also bear in mind that if either of them needs residential care, the islands house will form part of their capital. So it may not be possible to pass it on anyway.

sleepless_saver

bigmondy wrote: »

Incidentaly the estate was bequeathed to him 6 months ago but the £20k was only transfered last week from the lawyers - good grief I have just had a horrible thought. Does this mean he has to pay back his last 6 months benefits? eek

Probably not. Their pension credit award letter should tell them if there is an Assessed Income Period - if there is, they don't have to notify DWP of changes in capital until they are reassessed at the end of the period. They wouldn't be asked to pay back pension credit and associated benefits received during the period, but it would be taken into account from the start of the next AIP.