Spending and gifting my savings whilst on income-related ESA

McKneff

You are asking the very people who pay tax etc etc, to pay you your benefits, how to defraud the system.....

Are you for real.......

baza52

McKneff wrote: »

You are asking the very people who pay tax etc etc, to pay you your benefits, how to defraud the system.....

Are you for real.......

He is not asking how to defraud the system.
You can spend your own money on what you want, you only declare savings over 6K.

If your not reducing your savings to INCREASE your benefit entitlement then its perfectly legal and allowed.

Perhaps you could explain why you think its fraud.

ev8

_shel wrote: »

Giving your money away can be seen as deprivation of capital. Meaning they will still class it as if you had it and deduct from benefits accordingly.

Same goes for buying non essential items, flash new car for example. You'll be fine with day to day spending and replacing stuff as and when needed.

I think you are wrong about buying non essential items.

I think we are allowed to buy whatever we like with the money, otherwise you wouldn't be allowed to buy a few coats if you already have one. Or a new bag or something. Do they even check on what your buying?

Diary

The answer is you can spend benefits below the 6000 pounds savings limit on whatever you like. You can eat the money, burn it, give it to charity, whatever. There is no limit to how many gifts you can give each year.

It will not be classed as deprivation of capital unless you are doing it to increase your benefit entitlement. Which the OP , in this specific instance, she isn't doing.

allison445

Can only comment from my own experience of being over the limit when I claimed esa in December last year I had £10,000 by the time my benefit was paid I had had the expense of xmas and bill so my savings by then where just under 9,000 the computer said no how dare you spend money on rent and food and xmas so the deduction remained fast forward to august this year I received some money for my birthday which I promptly deposited in the bank till I decided what to buy myself I informed dwp that the money was form birthday gifts as I thought it would better to explain now about the deposit than further down the line. Another £2 was promptly deducted from my esa for the extra £300 so they are deducting for savings of £10,300 even though I have £9,224. Ive asked friends and family for gifts or gift cards this xmas no money please :rotfl:

missapril75

Bogalot wrote: »

Runa's post does not clear anything up.



This is accurate. You could essentially never go above £6K but be in breach of the rules if intentionally giving away money to stay below that level. In such a situation you would be treated as if you still had the funds and your claim adjusted accordingly.

The rules are not about giving away money. They are about deprivation of capital. Capital is not income and income is not capital unless it's accrued and not spent.

If the OP wants to give income away then the OP is giving away income and not capital.

[Deleted User]

Its worth bearing in mind that any benefits you receive are NOT counted as capital until the end of the period for which you received them

missapril75

allison445 wrote: »

...December last year I had £10,000 by the time my benefit was paid I had had the expense of xmas and bill so my savings by then where just under 9,000

Well, in theory, it could be said that by the time your benefits were paid they had refunded your expenditure and you were back to the original position.

the computer said no how dare you spend money on rent and food and xmas so the deduction remained

If you provided the proof that you were then at £9000, for them to treat you as still having £10k, they have to decide you reduced the capital for the sole or main purpose of gaining additional benefit.

There are other variables as well...did you, for example have £10k in a savings account but at the time of your claim you had also just received your usual month's wages. Under normal circumstances that would see you over the next month without you having to touch savings.

If that was the case it might actually be reasonable to decide the full £10k should be used in their assessment.

But if you didn't have another income like last wages and you really had to use savings, if you'd challenged them, they would have found it very hard to make a convincing case that you didn't need to spend some of it on rent and food. The xmas part would be arguable.

There is a calculation that they can do that identifies a reasonable spending rate. "diminishing capital" it used to be called...maybe still is.

Let's say you waited 4 weeks for your benefit and you hadn't received any income that you would normally have available.

If your rent was £100 a week and your benefit level was £75, then you would have needed £175 a week for expenses. Last I knew, this was rounded up to the nearest £10 so £180 a week would be an accepted spending rate without question.

So in 4 weeks they would say it was reasonable to have spent £720, meaning from the original £10k you "should" have £9280 left.

So the most they could say you still had was £9280.

And if that's what they decide, they still have to show that what you spent above the £720 was done with the sole or main purpose of getting more benefit.

Unless there was some other income immediately prior to your claim and/or some in the waiting period, they wouldn't stand a cat in hell's chance of convincing an appeal tribunal of that view.

fast forward to august this year I received some money for my birthday which I promptly deposited in the bank till I decided what to buy myself I informed dwp that the money was form birthday gifts as I thought it would better to explain now about the deposit than further down the line. Another £2 was promptly deducted from my esa for the extra £300 so they are deducting for savings of £10,300 even though I have £9,224.

Sounds like your claim has been assessed by someone with...let's say strong feelings. To put it mildly. Easy to say but if challenged something different would very likely have happened. Understandable that with the wait and other priorities you just let it go...peace of mind and all that.

Ive asked friends and family for gifts or gift cards this xmas no money please :rotfl:

A wise move

blobby8

McKneff wrote: »

You are asking the very people who pay tax etc etc, to pay you your benefits, how to defraud the system.....

Are you for real.......

Its clear the OP receives too much in benefit, thats why they continually give money away.
The system is designed to very slowly reduce benefits given to people with savings, £1000 extra savings reduces benefits by £4 a week. Clearly the OP is so desperate to optimize their "entitlement" to £4 a week (that they clearly do not need), that they are willing to give away £1000.
We know that, for at least one claimant, austerity and benefit reductions are not a problem.
I assume the OP is unlikely to be unique, so maybe these people could evangelize their strategies for living on benefits to those wailing about the cuts.

teddysmum

People are saying that it's ok unless you aim to increase your benefits by parting with money, but even if you give away to keep the benefit paid the same, you are, in fact, increasing on the benefit to which would be entitled should you keep money, which would have reduced that entitlement.