What is the rule on gifts from parents when on ESA?

ShaneT

Hi all, I have looked on the DWP's website and elsewhere to try to answer this question, as well as googling where I found others asking the same thing, but haven't been able to find a definitive answer.

I am in receipt of income-based ESA and I have no savings / capital. I also receive housing benefit.

I have debts and my parents have offered to pay some of it off on my behalf.

What I would like to know is, if my parents were to pay off some of my debts, how would this affect my benefit entitlement, if at all. I do not want to break any rules and I also don't want to have my benefits reduced because of receiving such a gift.

From what I have gathered, there IS a rule about 3rd parties such as parents making direct payments to companies or individuals on behalf of benefit claimants. So even if my parents were to directly pay the creditor so that I never actually have the money in my hands, or in my bank account, there is still a rule about it. What I haven't been able to determine is exactly what this rule is.

Would I need to inform the DWP (for ESA) and/or council (for housing benefit)?

Would it reduce one or both of those benefits?

The amount would not take me anywhere close to exceeding the minimum savings/capital allowance you are permitted to own before affecting your benefits. However, the issue is whether it would be looked at as some form of income, which may indeed affect it.

Thanks in advance.

rogerblack

The very simplest way that cannot be questioned is for them to pay the lender directly.

I do not believe there is such a rule as you quote.

Are you thinking about 'notional income'?
This does not apply if you have no legal access to the money.

ShaneT

rogerblack wrote: »

The very simplest way that cannot be questioned is for them to pay the lender directly.

I do not believe there is such a rule as you quote.

Are you thinking about 'notional income'?
This does not apply if you have no legal access to the money.

I was going by this document.

(I'm not allowed to post full links so offer these truncated ones, add https and www)

gov.uk/government/publications/decision-makers-guide-vols-8-and-9-employment-and-support-allowance-staff-guide

gov.uk/government/uploads/system/uploads/attachment_data/file/351183/dmgch51.pdf

Payments made direct to a third party when the claimant could receive the income direct

51143 The DM should treat payments made direct to a third party as the claimant’s income from the date the claimant could expect to get the income

1. if an application was made and
2. if the claimant could successfully apply to receive the income direct. This notional income should be treated as if it is actually received by the claimant

If memory serves correctly from when I checked those documents previously, one of them has a section which refers specifically to payments made directly from a third party to all manner of different third parties such as utility providers, car insurance providers, creditors and others. So there is a rule about it. But with probably thousands of pages of pdf files to read through, I am hoping someone knows the answer - but definitively, not just what they 'think' please.

TELLIT01

Your safest plan of action is to write to ESA explaining the situation and asking for a definitive answer on whether or not such actions would be treated as you having received income/capital.

rogerblack

ShaneT wrote: »

I was going by this document.

In short - the above does not apply, unless the parent specifically offers to give cash, and is declined.
If someone chooses to pay off your debts - with no legal obligation to do so - it does not count as income.
The above is to cover - for example - you asking your employer to instead of paying you normally -paying your creditors directly, so you can have all of your income apart from your disposable income ignored.

This is very different in that the employer has a legal obligation to pay you, and you could choose the payment method.