large win of Gift Vouchers and benefits

andrew71

Hi this question popped up in my mind the other day. I know that if you won a large cash prize you'd have to inform social but if you won a large sum of gift vouchers say for instance £20k of Tesco vouchers from an ITV competition would that be seen as having extra income because you'd be using vouchers instead of cash therefore saving your own money?

yoeydavis

i wouldnt tell them full stop. you havent worked; isnt that what you need to declare. if your not working you are entitled to benefits. i suppose its a personal choice i suppose, whatever your comfortable with.

sarahj1986

Don't they always say that the money you win is "tax free" therefore I doubt they need to know

LadyMorticia

With cash, even if it's tax free, if it is over £6000 (providing you're on means tested benefits) then you have to declare it. They class it as savings. Anything between £6000-£16000 sees your benefits be reduced by £1 for every £250 over £6000. Over £16000 and your means tested benefits stop all together.

To not declare having over £6000 in savings is illegal and fraudulent. However, for benefits like IB, CB ESA and DLA it doesn't need to be declared as these aren't means tested.

I know that your question wasn't about cash , OP. I was just answering the posts above.

As for vouchers, I have no idea, but I wouldn't have thought they were declarable as you can only spend them in one store. Don't quote me on that though!

starrybee

i wouldnt tell them full stop. you havent worked; isnt that what you need to declare. if your not working you are entitled to benefits. i suppose its a personal choice i suppose, whatever your comfortable with.

Not true, like Lady Morticia says, if you've got a ton of money in savings, you're entitled to nothing.

Like this Deal or No Deal winner: http://www.dailymail.co.uk/femail/article-2487151/How-mother-won-95-000-Deal-Or-No-Deal-carried-claiming-benefits-finally-brought-justice.html

No idea about vouchers though, but at a guess, you probably wouldn't have to declare.

mjm3346

If vouchers are something you have to declare when you claim in the first place then you probably would have to declare if you won (like shares etc) otherwise I doubt it - you don't have to declare that you have 18 months food stored in the stable block/garage/cupboard under the stairs and most vouchers cannot be turned into cash so how would you live off say £20,000 of kitchen equipment?

euronorris

I don't know for sure, but as a guess, I would say no. IF, however, you eventually built up savings of £6k or more (because you were able to use the vouchers for grocery shopping and other purchases etc), then you would have to declare that.

mjm3346

sarahj1986 wrote: »

Don't they always say that the money you win is "tax free" therefore I doubt they need to know

That simply means you are not taxed when you receive it, once it is yours it becomes part of your capital and is counted for benefit claiming, interest is taxable etc.

priorslee

sarahj1986 wrote: »

Don't they always say that the money you win is "tax free" therefore I doubt they need to know

mjm3346 wrote: »

That simply means you are not taxed when you receive it, once it is yours it becomes part of your capital and is counted for benefit claiming, interest is taxable etc.

I started thinking about this after seeing the recent TV program about the Deal or No Deal winner.

As MJM says, you won't be taxed on any cash winnings, but is that the same as having to declare it for benefits which are assessed purely on income and not capital? If you were lucky enough to win £5000 cash and this took you over an income-based benefit threshold, would you have to declare it?

I'm sure I read somewhere that interest from ISAs doesn't have to be included as part of your income for benefits assessment. If this is because it isn't taxed, then cash prizes from comps could also be not declared, but I'm not sure.
I suppose the safest option, if you found yourself in this situation, would be to ask the people assessing the benefits, but by doing that you've almost declared it anyway!

yoeydavis

yoeydavis wrote: »

i wouldnt tell them full stop. you havent worked; isnt that what you need to declare. if your not working you are entitled to benefits. i suppose its a personal choice i suppose, whatever your comfortable with.

sorry, i didnt mean my advice to be taken as gospel or law; just my own thoughts.