Can government check savings?

MikeR71

R_P_W wrote: »

If you have savings do you NEED benefits? What kind of benefit?

I may be looking at this a bit simply here but I think benefits should be for people who would suffer real hardship if they didnt have them - not to allow people to supplement their savings or even 'spend spend spend' as you put it!

Yes perhaps you ARE looking at this a bit simply. The government's own rules state that you can have some savings and still qualify for benefits. So as nilrem said, perhaps you are being a little unfair.

In an ideal world I'd be in favour of the removal of most benefits, provided that we are not taxed at every turn. Social justice is best achieved if people are allowed to keep what they earn. But that's a different argument and we do live in a welfare state.

Sceptic001

Coming back to the original question, banks remit 20% tax on interest to HMRC, so it wouldn't take a genius at HMRC to work out the average balance held in each interest-bearing account in any tax year.

Maybe someone with some inside knowledge could tell us if they do this and who else in government (eg DWP) has access to this info?

lisyloo

I was just wondering whether it's worth saving above threshold seeing that we lose so much if we do. Instead of saving I can buy household goods.

Assuming you are going to honestly report your figures (which I think you are) then it doesn't matter whether the government checks or not because you will be giving the correct information honestly.

The fact is they don't check everyone. They certainly could do checks if they suspected fraud or money laundering, but they wouldn't do it as a matter of course, but as already stated if you are being honest (which you are) then it makes no odds.

I think you are fully entitled to all the benefits that the government offer whether you need them or not and could do without any moralising.

If it's not too much money then my advice would be to stock up on non-perishable items that you know you would use in future. If you have a chest freezer then meat is a fairly expensive item.
But yes generally I would have thought it would be in your interest to spend on things that you KNOW you will use and will keep. Meat could be lost if you are unlucky enough to get a freezer failure - that's probably being paranoid, but you should think of what will you definitely use and what will keep with low risk of loss.

You may be able to gift money within certain limits e.g. to your child, but I'm not an expert on that. Check what the limits are, but I think you could.
You can certainly give generous (to a point) birthday and Xmas gifts to your child without anyone batting an eyelid.

It's a little bit of a grey area, but if you spent £200 on your childs birthday rather than £100 then I don't think anyone would call that fraud.

Just some things to think about.
People should keep their own morals out of this, there is illegal and legal and that's it.

srcandas

Sceptic001 wrote: »

Coming back to the original question, banks remit 20% tax on interest to HMRC, so it wouldn't take a genius at HMRC to work out the average balance held in each account in any tax year.

Maybe someone with some inside knowledge could tell us if they do this and who else in government (eg DWP) has access to this info?

Sceptic your assuming a great deal of collaborative communication of accurate information by different government departments and banks. While in theory such calculations may be possible from the systems of these organisations that I have seen I suspect the inaccuracies would be great indeed.

Wouldn't however surprise me if they did it as a worthless exercise at a statistical level

dtaylor84

MikeR71 wrote: »

£1 for every £250 seems grossly over the top. No saving gives you such a return so what does the government base this on I never know. It's nearly 20% if I am not mistaken?

Not sure what you think is 20%, but £1 is 4% of £250.

You'd need an ISA paying 4% or an account paying 5% (for a basic rate taxpayer) to 'beat' the deduction (or 6.6% for higher rate).

I've currently got a fixed rate ISA paying 4%, but you'll struggle to get near that with a new account...

srcandas

dtaylor84 wrote: »

Not sure what you think is 20%, but £1 is 4% of £250.

?? £10 is 4% of £250

£1 a week is approx 20% per annum

Hominu

MikeR71 wrote: »

No, I am no money launderer, and have no plans to commit fraud. I only ask because they keep asking how much I have saved when I fill benefit forms.

If you intend to save beyond the threshold and still expect to receive the same amount of benefits you are currently receiving, then you are committing fraud. The question is there for a reason: if you have lots of savings, then you don't need the benefits and should live from your savings instead.

srcandas

Hominu wrote: »

If you intend to save beyond the threshold and still expect to receive the same amount of benefits you are currently receiving, then you are committing fraud.

Really? I'm with lisyloo morals if at all should be in another thread.

Let's talk legal and illegal but no one has enough info to start throwing mud - certainly not me

The system discouraging saving and working I have serious concerns about and I have sympathy with the OP who has been very courteous.

Voyager2002

Hominu wrote: »

If you intend to save beyond the threshold and still expect to receive the same amount of benefits you are currently receiving, then you are committing fraud. The question is there for a reason: if you have lots of savings, then you don't need the benefits and should live from your savings instead.

That is a fair statement of the law. We could talk about whether or not this is fair over in the "Arms", but the OP needs to know that if his savings rise above the £6,000 mark then he is obliged to declare this (and see a small reduction in his benefits)and would otherwise be committing benefit fraud. Would he get caught? I don't know (and even if I knew I couldn't tell him) but that is not a risk that I would choose to run.

srcandas

Voyager2002 wrote: »

That is a fair statement of the law. We could talk about whether or not this is fair over in the "Arms", but the OP needs to know that if his savings rise above the £6,000 mark then he is obliged to declare this (and see a small reduction in his benefits)and would otherwise be committing benefit fraud. Would he get caught? I don't know (and even if I knew I couldn't tell him) but that is not a risk that I would choose to run.

Wasn't aware the law cited expectation as an offence? I appreciate intent under certain circumstances can be but surely 'expectation' is not the same as 'intent'?