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Capital own home possible rent impact on ESA (IR) PIP HB Ct

245

Comments

  • bloolagoon
    bloolagoon Posts: 7,973 Forumite
    Op in your previous posts you have equity so what changed?
    Tomorrow is the most important thing in life
  • Studebacher_Hoch
    Studebacher_Hoch Posts: 41 Forumite
    edited 22 July 2015 at 8:41PM
    Janetta, I think any rent in your situation should be treated as income, but there is a disregard up to the level of the mortgage payments, council tax and any water charges.

    So any rental income up to the level of those expenses put together is disregarded and it won't affect your benefit at all.

    I would ask them to confirm this is the case due to regulation 23 (2 and 3) of schedule 8 (Sums to be disregarded in the calculation of income other than benefits) of the ESA 2008 regs.

    I'll put my reasoning, with the regs, in my next post so people can check I'm interpreting it right.
  • tomtom256
    tomtom256 Posts: 2,250 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    rogerblack wrote: »
    Isn't the other issue that the OP wouldn't be entitled to HB at all if they own a property they are not living in?
    Separate from the capital rules.

    No it can be disregarded if effort is being made to sell the property for 26 weeks and at the LA discretion this can be extended indefinately.
  • Studebacher_Hoch
    Studebacher_Hoch Posts: 41 Forumite
    edited 22 July 2015 at 8:49PM
    So here's my thinking:

    ESA Reg 112... income treated as capital

    "(4) Except any income derived from capital disregarded under paragraph 1, 2, 4 to 8, 10, 16, 43 or 44 of Schedule 9, any income derived from capital is to be treated as capital but only from the date it is normally due to be credited to the claimant’s account."

    Paragraph 6 of schedule 9 (Capital to be Disregarded):

    "Any premises where the claimant is taking reasonable steps to dispose of those premises, for a period of 26 weeks from the date on which the claimant first took such steps, or such longer period as is reasonable in the circumstances to enable the claimant to dispose of those premises."

    - I believe this is your situation, so your case is one of the exceptions in 112 and the income derived from capital wouldn't be treated as capital but as income, so the relevant reg would be:

    Schedule 8 (sums disregarded in the calculation of income other than earnings)

    23.—(1) Any income derived from capital to which the claimant is or is treated under regulation 117 (capital jointly held) as beneficially entitled but, subject to sub-paragraph (2), not income derived from capital disregarded under paragraph 1, 2, 4 to 8, 10 or 16 of Schedule 9.
    (2) Income derived from capital disregarded under paragraph 2 or 4 to 8 of Schedule 9 but only to the extent of–
    (a) any mortgage repayments made in respect of the dwelling or premises in the period during which that income accrued; or
    (b) any council tax or water charges which the claimant is liable to pay in respect of the dwelling or premises and which are paid in the period during
    which that income accrued.

    Someone let me know if I've made a mistake.
  • tea-bag
    tea-bag Posts: 548 Forumite
    500 Posts
    bloolagoon wrote: »
    Op in your previous posts you have equity so what changed?


    The DWP are asking questions.
  • NYM
    NYM Posts: 4,066 Forumite
    Tenth Anniversary 1,000 Posts Photogenic Combo Breaker
    tea-bag wrote: »
    The DWP are asking questions.


    That made me giggle...:rotfl:
  • If the property has no capital value then it would have no impact on means tested benefits.

    The 26 week disregard can be extended if proof of reasonable steps to dispose of it can be shown.

    If the property was rented out then as long as the rental income was the same or less than any expenses (mortgage, insurance, agents fees etc) then it would have no impact on any means tested benefits.
    These are my own views and you should seek advice from your local Benefits Department or CAB.
  • Janetta
    Janetta Posts: 123 Forumite
    Thank you housing benefit officer -
    Is that what A mean in their response ?
  • Janetta
    Janetta Posts: 123 Forumite
    Hello Studebacher Hoch,
    Thank you for this .
    Can you simplify what you wrote for me ? Is it a yes or no.
    thank you
  • Janetta
    Janetta Posts: 123 Forumite
    They have all my details as i use to get interest only payments. Then I moved into social housing.
    Thanks for you response
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