Severence Pay and Benefits?

Daisy22

Hi i wonder if anyone can help? The company I work for is making huge cuts and have offered staff a severence package, i want to take it for two reasons, 1 - the amount they are giving will completely pay off all of my debts and 2 - Because there is a high chance of regular redundancy in a few months time anyway.

What I need to know is if I take the severence and use it to pay off all of my debts (leaving me with not much left) can I claim JSA, Housing Benefit and Council Tax Benefit?

I have been told by one person I can still claim benefits but someone else told me that because I will have left the job on my own accord that I cannot claim and that I will just get told that I should not have spent the severence on debts.

My plan would be to try and get some type of job asap but i just need to know if I can claim benefits for if I cannot find work straight away. Any advice would be welcome.

Thanks

princessdon

They would treat none priority debs as depravation of capital so look at this

No redundancy voluntary or compulsory doesn't matter for jsa, the job went, it's not like resigning that faces sanctions.

Horseunderwater

The capital should only be used for living expenses like council tax water food mortgage or rent etc as they are priority debts. Paying off credit or store cards are non priority, but you'd be allowed to pay the minimum off if you could afford that while you looked for work and depending on the amount of severance - if it is below £6k you may well qualify for income related JSA after 6 months - the whole point of redundancy pay is to give you living expenses for a time to help you get that new job. If between £6k - £16K then you'd still get some JSA - but it would reduce by £1/£250 of capital over the £6k limit - till you would not get anything other than Nat insurance credits. Good luck with it all.