Benefits and capital/current account

Heycock

Hi. Giving up work in couple of weeks to become wife's full-time carer so will be claiming several benefits.

When I add the MAXIMUM which can be in my current account at any one time to the TOTAL amount in my savings account, I'm over the £6000 lower limit

When working out capital for HB and IS, money sitting in the current account is included, but as both my and wife's accounts fluctuate between credit and overdrawn through the month what figure do they take?

Also, part of my savings (which are mostly the £3000 I very recently got as a personal injury payout) are ringfenced for the taxman...being on self-assessment means i pay the tax I owe when i get my final assessment which could be up to 18 months after the money was earned. So it's not really mine and if I was on PAYE I wouldn't have it in the bank. If HB and IS include this as MY capital then I am being discriminated against as a previously self employed person, surely?
Would it be deprivation of capital if I paid the taxman a lump sum as an advance payment of tax yet to be assessed on money already earned? After all I'd only be putting myself on an equal footing to someone on PAYE.
:beer:

princessdon

Heycock wrote: »

Hi. Giving up work in couple of weeks to become wife's full-time carer so will be claiming several benefits.

When I add the MAXIMUM which can be in my current account at any one time to the TOTAL amount in my savings account, I'm over the £6000 lower limit

When working out capital for HB and IS, money sitting in the current account is included, but as both my and wife's accounts fluctuate between credit and overdrawn through the month what figure do they take?

Also, part of my savings (which are mostly the £3000 I very recently got as a personal injury payout) are ringfenced for the taxman...being on self-assessment means i pay the tax I owe when i get my final assessment which could be up to 18 months after the money was earned. So it's not really mine and if I was on PAYE I wouldn't have it in the bank. If HB and IS include this as MY capital then I am being discriminated against as a previously self employed person, surely?
Would it be deprivation of capital if I paid the taxman a lump sum as an advance payment of tax yet to be assessed on money already earned? After all I'd only be putting myself on an equal footing to someone on PAYE.
:beer:

Sorry I don't get your logic about how your savings from a none earning related activity discriminates you as not PAYE.

Eg PAYE - Wages are £100 - Employee gets £80 in bank,
SE - Wages are £100 - You get £80 and you put £20 into a bank for tax.

Therefore you have spent your tax - that isn't the same as saying the savings are not your's.

As they will want to see bank accounts I can't see how you can justifty that a lump sum was your tax.

I may be a bit thick here, but I genuinely can't see your logic at all.

Heycock

Hi princess.
fictitious scenario.
claimant 1, all tax paid PAYE....has £5999 in bank...gets full HB.
Claimant 2 (me) Has £6500 in bank but is holding onto £2000 of it specifically for the taxman. Really therefore has £4500 in bank. Gets reduced HB.

princessdon

Heycock wrote: »

Hi princess.
fictitious scenario.
claimant 1, all tax paid PAYE....has £5999 in bank...gets full HB.
Claimant 2 (me) Has £6500 in bank but is holding onto £2000 of it specifically for the taxman. Really therefore has £4500 in bank. Gets reduced HB.

I get that - but it's the lump sum and source that I don't get. Ie I don't see how you can claim it's unclaimed future tax then show a bank statment showing a payout.

Sorry for being thick here, I just don't get how when they look at bank account going back a while you can show it was tax when it isn't.

Heycock

Princess...Forget the £3000 compensation for now. the other big part of the £6500 total is £2500 I've been putting to one side each month to make sure I can pay my final tax demand.
Say I'd earned a monthly salary of £2000...£350 would have come out PAYE instantly.
As S/E I earn the same but instead of taking the £350 immediately the taxman waits up to 2 years. Not my fault...that's the way it works.
But what you then have to do to avoid big trouble later is to put the equivalent away each month. Which is what HMRC recommend.

BUT HB treat it as my money when all I'm doing is holding it for HMRC.

So, we've both earned the same but I stand to get less benefit.

I'm actually more concerned about how and at what point in the month they assess the state of the current account because there are times in the month when the current a/c O/Ds would put us under £6000 anyway.

:beer::beer::beer:

princessdon

I don't think there is a "point". They ask on a set date for a period of statements.

Don't forget it doesn't stop your entitlement at all, just lowers based on the total.

Eg if you had £6050 - it would only lower by pennies.

If it is your Tax Account too (sorry I thought you were saying the insurance was that not in addition) then yes it does seem unfair.

princessdon

Sorry what I meant was that they'd look over a period of time as a whole not on a day.

Eg anyone can have money at start of month but not at the end. They'd look at the end of the month (before when the money goes in), and take it as a whole.

Heycock

It would be easier to have a dedicated a/c...but if HB wanted to be sticky about it they could still say it was just another savings account.
It's not an option anyway because as an ex bankrupt I'm restricted in what accounts i can operate. For example, I couldn't have a dedicated business account so ALL income and expenditure is mixed up in one account.

benefitbaby

Heycock wrote: »

It would be easier to have a dedicated a/c...but if HB wanted to be sticky about it they could still say it was just another savings account.
It's not an option anyway because as an ex bankrupt I'm restricted in what accounts i can operate. For example, I couldn't have a dedicated business account so ALL income and expenditure is mixed up in one account.

Hi, even if you put the money that you have earmarked for tax into another account it would still have to be declared for HB purposes etc.

One thought.... personal injury payments are disregarded (ignored) for 52 weeks after the date you receive it. When did you get yours? And if it is ignored does this bring you below the £6k lower savings threshold?

[Deleted User]

if you get IS then you get full ctb and full hb,you are not penalised twice for having above £6k in savings(only if you go above 16k then you lose it all),and if a benefit payment takes you over the limits its not counted until the end of the payment,i.e if its for 2 weeks its not counted for 2 weeks

Heycock

Benefitbaby...thanks. I got it a month ago...there's a paper trail so it's easy to prove where it came from. I'd heard about the 52 weeks somewhere else, then read that it no longer applied. Not on anything official though...haven't been able to find anything official either way.
And yes, if disregarded I would be well within the lower limit.
As "princess" says, it's not a significant amount i'd lose anyway but the thing is that after a lifetime of working (in the last 20 years for 70 hrs week at far less than minimum wage and only recently down to part-time 55hrs week) and never claiming or fiddling anything, I'm not inclined to accept a single penny less than i am entitled to. It's not exactly rich pickings for a 24 hour 7 day job!