Pension Credit and inheritance.

FloweryViolet

I've reposted this here in the pensions section as I first posted it in Benefits and Tax Credits, and I think I may have posted it in the wrong place so got no replies.

If a man of 62 is in receipt of Pension Credit and he inherits money that takes him above the £10,000 threshold, can he use any of that money to buy stamps that are missing from his National Insurance records?

For example: If a Pension Credit claimant had capital of £2,000, then received an inheritance of £10,000 thus placing them £2,000 over the Pension Credit Capital Disregard Limit but, then purchased missing N. I. Stamps to the value of £6,000 they would be left with capital of £6,000.

Would the Pension Service class this as a sensible action to take, and therefore, accept that the claimant's capital is £6,000 and therefore below the £10,000 disregard limit, or would they class the £6,000 spent on N.I. Stamps as Notional Capital and therefore consider that the claimant in fact had Capital of £12,000.

Also, would it be acceptable to the Pension Service for money from an inheritance to be used to pay back an informal loan that a Pension Credit claimant had received from his elderly parents, whereby they have for many years given money to help. There is a proven record of this money being paid into a bank account.

Many Thanks for any help you may be able to give. I am a new poster so, as well as apologising for being long winded, I hope I am doing things correctly.

F.V.

atush

I would imagine the loan would need to be documented in some way (letter etc). Try the CAB for advice.

BobQ

This question is not really about Pensions but Pension Credit. OP you might get a better reply on the Benefits thread.

As I understand it inheritance must be declared (it could be fraudulent if you fail to do so and so claim more than you are entitled)

Inheritance will be treated as capital in most cases so will reduce Pension Savings Credit frim the day of receipt.

You can use the capital in reasonable ways and they will adjust your PC. If you can prove that a loan existed then its possible to repay the loan from capital and so qualify for extra PC. You can also buy more pension with this capital. Whether they treat the loss of capital as notionally still being held depends on what is reasonable. The test is whether you would have done it anyway or are you spending just to get more PC. Best to ask them.


https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/258148/pc-10s.pdf