income support and savings

marjim

I'm a man aged 53 on income support and have just been informed that I stand to inherit about £37,000. I know I have to inform the benefits people but would like some advice on how much savings I am allowed before my IS is affected. I will be paying off my debts with some of this money but do I have to prove where every penny goes as most of my debts are loans from family and friends who have helped me in the past.
I don't want to do anything illegal so please, no advice on how to scam the benefits people, just want to know how to go about making the most of this unexpected windfall.
Thanks for looking
Jim

wazza

You are allowed to have £6000 in savings before your benefits are affected.

seven-day-weekend

...And with over £16000 in savings, you are not entitled to any means-tested benfits at all.

Congatulations on your windfall!

cattie

Also, if DWP feel you have paid debts off before they needed to be, then this will be considered deprivation of capital as a means to qualify for means tested benefits.

When you loaned the money off relatives & friends, what was the arrangement to pay them back? Have you been making regular payments towards these loans up till now?

real1314

ah, well, that's the grey area - you can pay off debts, after all, who can afford to pay credit card interest whilst on IS?

What they have to consider is whether your primary purpose is to gain more benefit. In the case of interest bearing debts, where you can avoid further interest (e.g a credit card debt, but not a loan agreement where you'd have to pay the full amount anyway) you can argue that you paid off the card (or whatever) to reduce the cost of servicing the debt and that this was your primary purpose.

You could also potentially argue that in paying off freinds and family, your primary purpose is to ensure that they stay as friends. Howvere you may have difficulty substantiating such debt repayments.

viktory

I wonder, if the debts are to friends and family will there be a paper trail? If you have debt, for example, with a credit card, store card etc then you can comfortably prove you owe the money. If, however, the loans are through family and friends and there is no paper trail, then how can you prove that you do owe this money and aren't, in fact, disposing of it to keep you benefits (not that I am suggesting that the OP is doing this, I hasten to add) these are just random thoughts.

You see, I have a loan from my Mum and there is no paperwork. I asked to borrow the money, she said yes, and I pay it back in cash each month.

Of course, if the OP has something in writing this could be a moot point.

Rikki

viktory wrote: »

I wonder, if the debts are to friends and family will there be a paper trail? If you have debt, for example, with a credit card, store card etc then you can comfortably prove you owe the money. If, however, the loans are through family and friends and there is no paper trail, then how can you prove that you do owe this money and aren't, in fact, disposing of it to keep you benefits (not that I am suggesting that the OP is doing this, I hasten to add) these are just random thoughts.

You see, I have a loan from my Mum and there is no paperwork. I asked to borrow the money, she said yes, and I pay it back in cash each month.

Of course, if the OP has something in writing this could be a moot point.

I have loan from my Mum (interest free ) and I pay it back each month through the bank.

If he was doing the same, would this be classed as a paper trail?

Anthillmob

id say yes in my opinion.

deprevation of capital is a grey area and a lot of time will go to appeals tribunal.

viktory

Rikki wrote: »

I have loan from my Mum (interest free ) and I pay it back each month through the bank.

If he was doing the same, would this be classed as a paper trail?

Yes, but how do you prove that the money you are paying is for a loan?

My loan is interest free as well

JohnQuays

In this situation you would be asked for evidence of how the money was spent. A paper trail in this case would exist, for example, a bank statement would show £x going out of you mothers account and into your account, and each month a credit will be going out of your account and into your mothers account. A letter from your mother to confirm the arrangement would also be further evidence.

mum2one

marjim wrote: »

I'm a man aged 53 on income support and have just been informed that I stand to inherit about £37,000. I know I have to inform the benefits people but would like some advice on how much savings I am allowed before my IS is affected. I will be paying off my debts with some of this money but do I have to prove where every penny goes as most of my debts are loans from family and friends who have helped me in the past.
I don't want to do anything illegal so please, no advice on how to scam the benefits people, just want to know how to go about making the most of this unexpected windfall.
Thanks for looking
Jim

Your allowed 8k before your benefits are affected, but upto 16k, aboe 8k, you start losing some of your benefits, hope that helps x