Calculating Benefits Overpayment and Diminishing Capital Rule

roy1953

Hi,

I am trying to help a neighbour who has mental health issues. They have got themselves in trouble with their benefit claim, because of undeclared capital.

I am trying to do an approximate calculation of how much the overpayment is. Using help given on here to other posters, I have managed to make a spreadsheet which I'm hoping will give the correct results.

I'm not sure though where to begin. Do I start at the earliest date and work to the current date? Or should it be done working backwards?

The other thing I'm not sure about is, I read that a separate calculation must be done for each benefit. (ESA, HB, CTB). So does that mean for example: if someone has savings of £18000, using the diminishing capital rule, I take away the amount of their weekly ESA multiplied by 13 weeks. Now they are left with say £16500. Next when I do the housing benefit, do I start from the £18000 again?

In some ways this doesn't seem right because, if they hadn't had the ESA (overpayment) they would have spent an equivilant amount of savings. Then the same for HB and CTB. I guess what I'm trying to say is, if I've got this right, the same money (savings) is being spent three times.

Thanks for reading this and any help much appreciated.

[Deleted User]

How much are they being told they were over-paid by? Once you have over 16k all income based benefits cease (well most of them do). Usually they would be asked to provide evidence (i.e receipts) for what they had spent the money on to reduce savings below 16k.
You would also need to know what capital rates the council charges as they are not all 16k now.

roy1953

Hi,

At this stage they haven't been given any figure for the overpayment amount. The letter just gives an appointment for an interview with regards to undeclared capital.