Bank Charges when on Benefit - HELP PLEASE!!

jacques_chirac

GingerFurball wrote: »

What the act does is the following:

Let's say you have a basic cash account with no overdraft facility.

You run your account badly and rack up £80 of charges one month.

The bank applies those charges and it takes your balance to -£80.

Your benefits of £80 get paid into your account taking your balance back to £0.

The bank has to allow you access to that £80, they can't swallow up that £80 to pay off your overdraft facility. The bank is still perfectly entitled to charge you for using overdraft facilities etc but is also obliged to provide access to your benefit money.

You are referring to the right of appropriation. The bank are not obliged to give access to the money unless the account holder requests it in advance. They may do so after the event, but that would be as a goodwill gesture.

dunstonh

GingerFurball wrote: »

S/he might be entitled to some sort of refund depending on their bank's policy. It's certainly worthwhile calling up and asking for their charges to be refunded.

There is no entitlement. She is reliant on the goodwill of the bank.

JuicyJesus

GingerFurball wrote: »

What the act does is the following:

Let's say you have a basic cash account with no overdraft facility.

You run your account badly and rack up £80 of charges one month.

The bank applies those charges and it takes your balance to -£80.

Your benefits of £80 get paid into your account taking your balance back to £0.

The bank has to allow you access to that £80, they can't swallow up that £80 to pay off your overdraft facility. The bank is still perfectly entitled to charge you for using overdraft facilities etc but is also obliged to provide access to your benefit money.

This is an Internet myth and is simply not true.

[Deleted User]

skint.com wrote: »

Hi,
Apologies if this is posted already. I have stumbled upon the following.... is it legit does anyone know please?


'There is an Act of Parliament which over-rides banks taking charges from your account if you are in receipt of any of the following benefits.

• Income Support
• Tax Credits
• Child Benefit
• Job seekers allowance
• Incapacity benefit
• Disability living allowance...
• Attendance Allowance
• CSA payments
• Other DWP payments.

These social security benefits are granted to stop hardship and are designed to meet basic day to day needs, and are exempt and are protected under the Social Security Administration Act 1992 sub section 187. from arrestment in terms of section 187 of the Social Security Administration Act 1992 (see Enforcement of Civil Obligations in Scotland, Scottish Executive report, at paragraph 5.245).

Section 45 of the Tax Credits Act 2002 Chapter 21 part 1 is an identical provision to the said section 187 of the 1992 Act. This stipulates that the banks can not apply any charges to money received as benefit, and any such charges are unlawful and therefore disallowed.

Go to your bank and speak to them about their charges. All the info you need is here. Claim back what should never have been taken from you in the first place!'

Thanks folks,

Skint.com
:T

jacques_chirac wrote: »

The quoted law does exist, but it has been misinterpreted...

dunstonh wrote: »

Its an internet myth....

dunstonh wrote: »

you are not entitled to a penny refunded...

Aquamania wrote: »

Note: this doesn't specifically cover the deduction of bank charges from your benefits under the Social Security Administration Act 1992 - this is an urban myth.

dunstonh wrote: »

There is no entitlement...

JuicyJesus wrote: »

This is an Internet myth and is simply not true.

I wonder if anyone could clarify the legal position for me? :cool:

JuicyJesus

darkfield wrote: »

I wonder if anyone could clarify the legal position for me? :cool:

Bank charges are in the nature of an expense incurred by the account holder. Were it currently disallowed to take bank charges in particular from benefit income, then logically it would be disallowed to take any expenses out of benefit income.

Additionally adding funds to a bank account is like adding water to a tank of water. The two cannot be unpicked later and the benefits money is not distinct from any other money held in the account. As such there are no grounds for saying that benefit funds should be treated specially in some way.