Inheritance impact?

deebeeoh

[FONT=&quot]Unfortunately my great uncle died recently and we're currently in the process of waiting for the will to be read. It's sent my cousin into a bit of a tailspin of anxiety over what may lie ahead.

To the best of our current knowledge, his father's will is very simple and states that he wished to split his estate equally between his five children.

As not all of his children had children themselves, so he did not believe it was fair to take a portion of money out of the estate to split between the grandchildren, but he advised everyone in person (on numerous occasions) that he wanted his children to give money from their inheritance to their own children, however they saw fit.

In addition to this, his lasting power of attorney/executor has confirmed that this wish was apparently mentioned during the will writing process, however since the will has not yet been released/read we cannot be certain that any clause to this effect was actually placed in his will officially.

This obviously shouldn't be a problem for the most part, however my cousin (the deceased eldest son) is disabled due to an accident thirty years ago, and claims ESA and PIP. He lives hand to mouth and always has done, so he was hoping that he could use his inheritance money to finally do some home improvements and adaptations that will make his life more comfortable with his deteriorating health.

If there was anything left after that, he hoped to split it between his two children (as desired by his father) in the hope of putting towards help for them to get on the property ladder. Unfortunately, no one in the family had the foresight to consider how inheritance would affect his benefit claim and make plans accordingly before time.

So my question is, would it be above board for my cousin to go ahead and give money from his inheritance to his children as per the wishes of his late father? Or would that be seen as deprivation of capital, without a clause in the will stating his father's full wishes?

If this would affect how my cousin's inheritance can be shared out in the eyes of the benefits agency, can anything be done to change or counteract that?

Would a letter from his power of attorney/executor -stating that he was fully aware of his father's wishes for his grandchildren to be given a share of their parents inheritance- help make things legal and above board? Without causing my cousin to lose benefits, while still allowing him to spend the money on making much needed improvements to his quality of life and potentially help his own kids? Or is he looking at losing his benefits anyway, until he's below the savings threshold?

Someone mentioned how a Deed Of Variation(?) could help resolve this issue, but I'm not sure how accurate that is in these circumstances, because from what I've read it doesn't seem like it's what's needed.

Any help would be hugely appreciated, thanks for taking the time to read.
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worried_jim

This could be tricky as it wasn!!!8217;t written in the will, therefore it!!!8217;s not in the will.

pmlindyloo

deebeeoh wrote: »

[FONT=&quot]Unfortunately my great uncle died recently and we're currently in the process of waiting for the will to be read. It's sent my cousin into a bit of a tailspin of anxiety over what may lie ahead.

To the best of our current knowledge, his father's will is very simple and states that he wished to split his estate equally between his five children.

As not all of his children had children themselves, so he did not believe it was fair to take a portion of money out of the estate to split between the grandchildren, but he advised everyone in person (on numerous occasions) that he wanted his children to give money from their inheritance to their own children, however they saw fit.

In addition to this, his lasting power of attorney/executor has confirmed that this wish was apparently mentioned during the will writing process, however since the will has not yet been released/read we cannot be certain that any clause to this effect was actually placed in his will officially.

This obviously shouldn't be a problem for the most part, however my cousin (the deceased eldest son) is disabled due to an accident thirty years ago, and claims ESA and PIP. He lives hand to mouth and always has done, so he was hoping that he could use his inheritance money to finally do some home improvements and adaptations that will make his life more comfortable with his deteriorating health.

If there was anything left after that, he hoped to split it between his two children (as desired by his father) in the hope of putting towards help for them to get on the property ladder. Unfortunately, no one in the family had the foresight to consider how inheritance would affect his benefit claim and make plans accordingly before time.

So my question is, would it be above board for my cousin to go ahead and give money from his inheritance to his children as per the wishes of his late father? Or would that be seen as deprivation of capital, without a clause in the will stating his father's full wishes?

If this would affect how my cousin's inheritance can be shared out in the eyes of the benefits agency, can anything be done to change or counteract that?

Would a letter from his power of attorney/executor -stating that he was fully aware of his father's wishes for his grandchildren to be given a share of their parents inheritance- help make things legal and above board? Without causing my cousin to lose benefits, while still allowing him to spend the money on making much needed improvements to his quality of life and potentially help his own kids? Or is he looking at losing his benefits anyway, until he's below the savings threshold?

Someone mentioned how a Deed Of Variation(?) could help resolve this issue, but I'm not sure how accurate that is in these circumstances, because from what I've read it doesn't seem like it's what's needed.

Any help would be hugely appreciated, thanks for taking the time to read.
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Best advice is to wait until you know the contents of the will (by the way, wills are not read, that only happens in films!)

Who is the executor?

As regards the inheritance....... PIP is not means tested and will not be affected.

If the ESA is completely contribution based or partly contribution based then any savings are not taken into account. Savings are taken into account in an income based claim or the income based part of a claim (check the ESA award letter) - in the latter case he would lose the income related part but retain the contribution based part.

Unless the grand uncle specifically leaves the grandchildren some money in the will then his 'wishes' would not be enough.

Deprivation of capital arises when the claimant uses his capital to keep benefits/increase benefits.

Giving large sums of money to his children would probably be viewed as deprivation of capital.

Spending the money on necessary things to improve the cousin's quality of life would likely be OK.

A deed of variation is considered deprivation of capital.

Obviously your cousin needs to wait to see what his inheritance will be. Likely sum?

Once he knows the amount then the very best way to do this is to inform the DWP and say what money he would like to spend and why - e.g. new furniture as it is very old etc ets. A Decision Maker will look at his case and make a decision as to whether it is deprivation of capital.

If DM confirms in writing that spending such and such for the purpose of such and such then it cannot be considered deprivation of capital.

marliepanda

Highly unlikely. It!!!8217;s his money, and with no will they will not take the word of a part who has an interest in the money.

His PIP will not be affected but his ESA will.

I very much doubt his children will want to take money from their father who is disabled and lives hand to mouth.

Starrystarrynight1

When the time comes, I'd suggest your cousin speak to an ESA decision maker at the DWP to see if the cost of making adaptations to his home (eg a wet room or installing a stair lift) required solely because of his disability could be disregarded.

TELLIT01

If the cousin is living 'hand to mouth' it's difficult to believe that his great uncle would expect him to continue to live that way and to pass the money on to his children.
That is irrelevant anyway, as passing money on would almost certainly be seen as deprivation of capital by DWP. He can certainly use part or all of the money for home improvement as long as they are shown to be necessary and not just being used as a way to dispose of the inheritance.
Until the detail of the will is known it's impossible to be more specific than that. Has any indication been given as to what 1/5th of the estate will equate to? Even on Income Related ESA the first £6k is disregarded and entitlement reduced by £1 per week for every £250 above that figure until the final cut off point of £16k when entitlement to Income Related benefit ceases.

Pollycat

Regardless of what the deceased uncle expected or desired, if it's not in his will, it doesn't have to happen.
Once the money is distributed to the beneficiaries, it's theirs to do whatever they want to do with it.
Deprivation of capital will not be a good choice.

deebeeoh

Just had a call from him saying he'd been in touch with the DWP this morning and asked what his ESA is made up of. Apparently they said his is part income based and part contributions based. Talk about muddying the waters....

Anyone have a clue how that could impact on entitlements?

pmlindyloo

deebeeoh wrote: »

Just had a call from him saying he'd been in touch with the DWP this morning and asked what his ESA is made up of. Apparently they said his is part income based and part contributions based. Talk about muddying the waters....

Anyone have a clue how that could impact on entitlements?

He would retain the contribution based part (£109.65 per week) as long as he was in the Support Group. Contribution based ESA is not affected by savings.

He would lose the income based part and any premiums if his savings were over £16000.

His PIP award would not be affected.

poppy12345

Penitent wrote: »

I get contribution-based in the support group and it's £109.65 a week. I don't qualify for any income-based. I'm now worried I'm being overpaid.

Contribution based Support Group amount is £109.65. £73.10 is assessment rate.

pmlindyloo

poppy12345 wrote: »

Contribution based Support Group amount is £109.65. £73.10 is assessment rate.

Oops!

Sorry, you are correct.

Have edited my post.