Deprivation of Capital

Missing_Link

I am self employed, but due to an ongoing medical condition, I claim Working Tax Credit & Housing Benefit. I live on my own.
My dad has sadly just passed away. His estate will be shared between four of us, which will be approximately £30,000 each.
We have never had much in life & I was excited to think that I would be able to upgrade my old car which is predominantly used for my business, pre pay my own funeral (no life insurance or private pension), treat myself to my first ever new sofas & bed, which will both be of benefit to my ongoing medical condition.
I have now been told this could be classed as deprivation of capital. I have no intention of spending all the money, just some to better me & then pay my way.
Any advice would be greatfully received.

pmlindyloo

Missing_Link wrote: »

I am self employed, but due to an ongoing medical condition, I claim Working Tax Credit & Housing Benefit. I live on my own.
My dad has sadly just passed away. His estate will be shared between four of us, which will be approximately £30,000 each.
We have never had much in life & I was excited to think that I would be able to upgrade my old car which is predominantly used for my business, pre pay my own funeral (no life insurance or private pension), treat myself to my first ever new sofas & bed, which will both be of benefit to my ongoing medical condition.
I have now been told this could be classed as deprivation of capital. I have no intention of spending all the money, just some to better me & then pay my way.
Any advice would be greatfully received.

First of all, tax credits will not be interested in your savings. Deprivation of capital does not apply. You only have to declare it if you earn over £300 in interest in a year.

Deprivation of capital may apply as regards your HB. You need to declare it and your HB will be stopped.

When your savings dip below £16000 then you can reapply. This is the point when they will consider deprivation of capital. They have to prove that spending the money was done so that you could keep/claim HB.

Next they have to look at what you spent it on. Any spending has to be reasonable so upgrading your car would be fine, buying a very expensive car may be questioned. New sofas and bed would be fine. A funeral plan would be fine.

After notifying the council of your savings if you spent all the money so you could claim HB then that would probably be questioned. If you spent reasonably and paid your rent yourself for a time then it may not be questioned.

In the end if you apply for HB and they see your spending as deprivation of capital then you can appeal. In the end only a decision maker can make the call.

Make sure you keep receipts for your spending (just in case)

Sorry for your loss. Please don't think you can't spend any money, just be sensible about it.

Housing benefit officer (a regular poster) may give you further pointers.

Missing_Link

Thank you ever so much for your reply.
Any idea what would be classed as too expensive with a car would be appreciated? I live in a very rural spot, so was hoping to buy an All Wheel Drive estate, so that I don't get stuck in bad weather.

[Deleted User]

a rolls royce would be out of the question but anything "within reason"will be ok

Missing_Link

Haha. I wouldn't get a Rolls Royce to fit through the country lanes!!