Incapacity benefit and lump sum

josoph

Just wondered if anyone is able to shed some light on my situation.I am currently on incapacity benefit long term,for which I receive £221.70 every fortnight.I have been granted a pension from my employer.I am able to take a lump sum of roughly 17k tax free and then a monthly payment thereafter.
I am aware that if you have savings of over 9k you need to advise benefits and also housing and council tax benefit.If I would like to give my daughter some money and buy her a car,meaning I will have under the 9k.Am I able to do this??? Not sure if I will be penalised as I did have more than the limit originally.

McKneff

Google 'deprivation of assets' that should answer your question.

In short, if you give your money away, you will still be assessed as if you still had it.

Dunroamin

Although deprivation of capital shouldn't be an issue with IB, that will change when you move to ESA and could be a problem then.

Don't forget that, although IB isn't means tested, it will be affected when you start receiving your pension and could disappear altogether.

zaksmum

I thought long term incapacity benefit was not means tested...?

McKneff

I would think with a £17K lump sum (and Im only guesstimating) that your pension is going to be less than around £350 a month which is when it starts affectin your IB (going from my own experience) but hey, legislation seems to change on a daily basis.

If youclaim any means tested benefits I would be cautious about giving your money away.

McKneff

zaksmum wrote: »

I thought long term incapacity benefit was not means tested...?

It isnt means tested but private pension income can affect it.

zaksmum

Oh, thanks Mckneff, I was worried there for a minute!

Mojisola

josoph wrote: »

Just wondered if anyone is able to shed some light on my situation.I am currently on incapacity benefit long term,for which I receive £221.70 every fortnight.I have been granted a pension from my employer.I am able to take a lump sum of roughly 17k tax free and then a monthly payment thereafter.
I am aware that if you have savings of over 9k you need to advise benefits and also housing and council tax benefit.If I would like to give my daughter some money and buy her a car,meaning I will have under the 9k.Am I able to do this??? Not sure if I will be penalised as I did have more than the limit originally.

Shouldn't that be £6k?

jonliv

Your Incapacity Benefit will not be affected by Pension Income if you satisfy any ONE of these conditions


Exceptions
This rule does not apply if:

1) you were in receipt of Incapacity Benefit before 6 April 2001,

2) your claim is made under the linking rules for Incapacity Benefit and links back to before 6 April 2001,
or

3) you receive the highest rate of the care component of Disability Living Allowance

There are also transitional arrangements in place for when you are migrated to ESA

Dunroamin

OP, do you claim any means tested benefits?

josoph

I recieve Tax credit,child benefit and Incapacity benefit.
I have had incapacity benefit for two years.Yes my pension will be about £230 a month.
So if I use this money they will still look at it as if I still have it,is that what your saying?