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Equity and loss of benefits.

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Comments

  • jaxa
    jaxa Posts: 16 Forumite
    Thanks you have understood what I'm trying to do....I haven't paid into any pension scheme so can you elaborate on this bit please..For example, you could also throw some amount of it into a pension (up to the amount you earn this year (and the last couple of years before, to the extent you didn't use your full allowance)) with the intention of withdrawing it in a few years time when needed for further education.
  • xylophone
    xylophone Posts: 45,426 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    The pension idea might not work as the OP is already over the age when he can have full legal access to any pension - see https://forums.moneysavingexpert.com/discussion/4979191 post 7.

    With regard to gifting money to his children through JISA, this might be a possibility - I say this because the original CTF actually gave higher value state funded vouchers to children of low income families - it would seem likely that the parents in such families were receiving means tested benefits - it would be rather odd if they were penalised for making contributions to the CTFs.

    That said, it would seem that the making of payments to JISAs by the OP could be interpreted as a device to keep or increase means tested benefits - I guess he would have to clarify the matter with the local council.

    It would seem that the capital could be disregarded for up to 26 weeks if the OP were planning to buy a house?

    More information might be available on the Benefits Board?
  • bowlhead99
    bowlhead99 Posts: 12,295 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Post of the Month
    xylophone wrote: »
    The pension idea might not work as the OP is already over the age when he can have full legal access to any pension - see https://forums.moneysavingexpert.com/discussion/4979191 post 7.
    I'm no expert but on your post there you were describing the a situation of notional income for the year rather than notional capital.

    So if the person had only £2000 of income for the year and put £500 of it into a pension, he is not 'depriving himself of an income to secure housing benefit' because he perhaps doesn't get any more housing benefit now he has £1500 of income than if he had £2000 of income. If he was entitled to housing benefit before he is not claiming more housing benefit now due to that reduction in income.

    And on the capital side, from the link you'd posted in that other thread, assets stuck in a personal pension fund do not qualify as being 'possessed' by the person as notional capital (no age limit given, unlike with the notional income).

    So, the money given up to put in a pension might decrease income further (which would be irrelevant if income-related benefits would still exist if the benefits people decided they wanted to add it back to income); but would also decrease assets further (and the pension assets wouldn't be added back as notional assets because they can't be accessed in full).
  • xylophone
    xylophone Posts: 45,426 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    I am not an expert either but my thinking is that as he is over the age when he can have full access to a pension, any available benefit from the pension could be regarded as pension/capital (depending on how taken)?

    And as he is over both state and private pension age and drawing means tested benefits, putting capital into a pension ( and if he is looking for tax relief, as he has no earned income, the contribution could not be more than £2880 net) might be regarded as depriving himself of capital to increase entitlement to benefits?

    And from next tax year, it would seem that the whole pension could be taken as cash?

    The OP's capital from the house sale would seem to amount to more than just a few thousand.

    As I commented previously, there might be more information/help on the Benefits Board - and, as I also commented, he would need to discuss his situation with the council?
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