Can government check savings?

Rosemary_Jane

MikeR71 wrote: »

Not making anything up. I wasn't talking about child benefit which we still get. I was referring to the working tax credit, the childcare element which is based on income and childcare costs etc. You do have to fill a form for this and declare income, savings etc. I though this was clear in the original post. Sorry.

Hi Mike,
With Working and Child Tax Credits, capital doesn't count at all.
Any interest you earn over £300pa is counted as income.
Any interest in ISAs is disregarded.

This is explained in the notes that come with the claim/renewal forms. I'm sure they're available online.

I know this, because I get tax credits, and my savings are well over the threshold.

This will change when the Universal Credit starts, as capital is then counted.

HTH
R

antenna

To pay the full amount early, including the projected interest (included at the outset of the loan) and then pay an early
redemption charge seems strange and possibly ilegal.
Why would the loan company NOT want the money paid up early?,they are getting the full amount early!
There must be more to this than you are telling,are there any insurances,waranties,loan guarantees that you pay alongside this loan to make it worthwhile for the lender to keep you in debt?

somethingcorporate

I do find it somewhat backward that some benefits are means tested and others not.

If someone has £x amount in capital then they should not need state handouts in whatever format. When they get below £x then they should be able to claim.

Fortunately, it seems that the UC is coming in to do this.

I am not sure you will find many that agree with you Mike that benefits are not too generous. The welfare state is rediculously expensive - the reasons for which are best left to DT but I am not sure you'd convince many it was only the fault of the prevailing Government.

Personally, if the Government can prevent benefit fraud (which costs the country many £bns a year) by peering into our bank accounts then I am all for it. I am also totally in support of everyone knowing how much everyone else earns and how much tax they pay but then again I have nothing to hide.

antrobus

antenna wrote: »

To pay the full amount early, including the projected interest (included at the outset of the loan) and then pay an early redemption charge seems strange and possibly ilegal...

There's no 'possibly' about it. It would be illegal. CCA regulations require lenders to rebate interest on early settlement and CCA regulations require the rebate to be calculated on an actuarial basis.

MikeR71

antrobus wrote: »

No, you'd have had to pay £13,000 plus the early repayment charge. Roughly speaking.

That's not what we were told. The bank in question is HSBC and in fact as we have online current accounts with them, the next day they set up a loan account for us showing 15500 owing to them. I will read the T&Cs of the loan again but I am sure I am right.

MikeR71

Rosemary_Jane wrote: »

Hi Mike,
With Working and Child Tax Credits, capital doesn't count at all.
Any interest you earn over £300pa is counted as income.
Any interest in ISAs is disregarded.

This is explained in the notes that come with the claim/renewal forms. I'm sure they're available online.

I know this, because I get tax credits, and my savings are well over the threshold.

This will change when the Universal Credit starts, as capital is then counted.

HTH
R

Thanks Rosemary,

I filled in the working tax credit forms recently as our kids started nursery and there was definitely a box asking for income from savings (but not ISAs). We got the reply back saying we do not qualify for working tax credit, but we do qualify for the childcare element, which is ~ £25 a week.

This is not a lot but considering that our nursery fees are roughly £1200 a month, it is better than nothing.

Anyway, the question made me think whether governments can access our bank and savings accounts, which until now I had considered to be private and confidential. I did not ask for fraudulent purpose as a few people here hinted earlier but I do understand how my question would make people think that way!

innovate

MikeR71 wrote: »

.....the only benefit we get is child benefit and a little help with nursery fees as part of the child element.

MikeR71 wrote: »

Not making anything up. I wasn't talking about child benefit which we still get. I was referring to the working tax credit, the childcare element which is based on income and childcare costs etc.

OK, so we have established you get child benefit and working tax credit. And that for neither of these, you need to declare how much you have in savings. What you do need to declare for the Working Tax Credit is your income from savings, unless they are in an ISA. Given that you said your savings are in an ISA, they are therefore totally irrelevant to the two benefits you are claiming.

Seems you weren't properly informed when you started the thread.

As to why you can't pay back the loan early: I am still not convinced it wouldn't make sense to pay it off early. But we don't have enough information, such as who the lender is, and what the T&Cs are. If you are prepared to share more info here, people may be able to suggest more. Or you could ask your local CAB to glance over the loan agreement and advise what needs doing for early redemption, and what you would save if you did that.

Other than that, have a look as to whether you can get your ISA transferred to somewhere that pays more than 2%. Make sure you have read the transfer guide first, though, so you fully understand the rules.

zagfles

MikeR71 wrote: »

Not making anything up. I wasn't talking about child benefit which we still get. I was referring to the working tax credit, the childcare element which is based on income and childcare costs etc. You do have to fill a form for this and declare income, savings etc. I though this was clear in the original post. Sorry.

You do not have to declare savings for working tax credit, there are no capital limits at all. There is nowhere on the tax credits forms where it ask how much you have in savings.

You do have to declare any taxable interest if you get over £300, but unless you have a vast amount of savings it won't make much difference to the claim.

Plus you don't need to declare tax free interest (eg from ISAs) at all. A couple could save about £11k per year between them or £22k in a shares ISA and it has no effect at all on WTC, neither the capital nor the interest.

This will change with UC, there will be capital limits, but there is transitional protection which will apply to those with savings claiming tax credits.

MikeR71

somethingcorporate wrote: »

I am not sure you will find many that agree with you Mike that benefits are not too generous. The welfare state is rediculously expensive - the reasons for which are best left to DT but I am not sure you'd convince many it was only the fault of the prevailing Government.

Personally, if the Government can prevent benefit fraud (which costs the country many £bns a year) by peering into our bank accounts then I am all for it. I am also totally in support of everyone knowing how much everyone else earns and how much tax they pay but then again I have nothing to hide.

Well, as I said before I agree that the welfare state is wrong and immoral. There is something distasteful and even disgusting about redistribution of wealth as is practiced under social and welfare programmes. Robin Hood was a myth!

I am a Libertarian, proponent of the free market economy. I believe that the welfare state not only does NOT help the poor and the people it tries to help, it actually does them harm. There is certainly no utopia, but in trying to eradicate poverty, no system has proven more effective than free market capitalism. Again, it is not perfect but as we all know too well, neither is socialism.

There is something grossly disturbing about welfare state, and that is the power which governments hold over us. Day by day we relinquish more of our personal liberties to the government. Socialism is force. It is no surprise that almost all fascist and totalitarian states have grown out of socialist economies. History is full of examples. Conversely, where you have true individual freedom, you will have capitalism.

Anyway, by making the state smaller, you can reduce taxes. That way so many people can afford to live on their own wages without needing to stretch a hand to the government like needy paupers and slaves and claim benefits. Most people wouldn't need child benefit if the government didn't tax so much so it could spend on its various departments.

le_loup

What a prat! Wait until you need a helping hand. Wait until you claim your pension. Wait until your children need education. Wait until you need the police. Wait until you get dementia.
Oh boy, we are heading to Republican Tea Party politics now in this country. Want a gun as well?