Overpaid on Income Support

Izzy_Ziddi

Hi hope someone can advise on a matter which I previously posted on here PLEASE READ MY PREVIOUS THREAD TO FULLY UNDERSTAND my current situation. I cannot post the link but it's titled "DWP & HMRC - capital gained from credit card money transfers"

The money being referred to as savings is a balance transfer from my credit card into my current account which was transferred to a friend who needed a loan and is paying the monthly repayments. All receipts and bank statements have been provided showing where the money has been spent.

DWP have decided that I have been overpaid for the whole duration of my claim and I need to repay back £?? as I wrongly declared that I had savings less than £6k when I made the claim. They also state that I have not provided bank statements and receipts as requested by the Compliance Officer and they have not made any reference to dates and figures to when they believe the savings over £6k was accrued from. I contacted the Compliance Officer who confirmed she had emailed all the documents to the Decision Maker and if the letter states I had/have £6k or over then it must be correct! She was adamant that the "benefit law states the source of capital is irrelevant even if it is a loan" however the overpayment should be from when the excess "savings" came into the account.

It appears DWP send standard letters and i'm currently awaiting for a detailed explaination about how they reached their decision but is it possible they have made a mistake? The money was in my account for 1-2 days and I ended my claim within a week of this for personal reasons so shouldn't the overpayment period be just that - 1 week? If they are correct then I will be liable to repay the housing benefit and council tax reduction which I cannot do as I have no source of income.

poppy12345

See other thread here. https://forums.moneysavingexpert.com/discussion/5750389

Deprivation of capital, possible? I maybe wrong, it was just a thought.

TELLIT01

I suspect DWP's thinking is that if you have been able to lend £x to somebody you must have had that money available to you. You have made £x not available to you therefore it is deprivation of capital. Further, you must always have had £x available and didn't declare it therefore there is an overpayment.
I'm not saying I agree with their interpretation, in fact I think it's wrong, but it will depend on interpretation of available capital.
If you had taken out a bank loan to lend to somebody I don't know if that debt would be used to balance out the loan.

pmlindyloo

I am not sure from your post whether a decision has been made or whether that process is still in progress.

If a decision has been made then you can appeal it. You would have to ask for a mandatory reconsideration first. Read this link:

https://www.citizensadvice.org.uk/benefits/benefits-introduction/problems-with-benefits-and-tax-credits/challenging-a-benefit-decision/challenging-a-benefit-decision-where-to-start/

If you haven't received a decision letter yet then it is possible that your overpayment will only be assessed for the period when the money was in your bank until the end of your claim.

My personal 'take on it ' is that receiving money in the form of a loan would be counted as capital. The fact that you 'gave it away' would be considered as deprivation of capital and you would be treated as if you still had it. I think they would consider it irrelevant that you gave the loan to a friend who agreed to repay it.

The only query I think you could challenge is the time you had the capital. If you have sent them evidence of the application for the loan and the date it was transferred to your bank then I think the savings would be treated as from that date to the end of your claim.

BUT, I am not the decision maker!

So, please tell us which stage you are at, you have had the decision or you are waiting for a decision with the amount of overpayment?

Izzy_Ziddi

I have only just received a letter with outcome of the Compliance investigation but as the letter is very basic I have requested a more detailed explaination. How is having credit cards classed as personal capital when it doesn't belong to me and ultimatley has to be repaid with interest? If I have had credit cards, which I have for over 20 years and chosen not to use them are they saying instead of claiming Income Support i should have used my credit card? I plan to write a MR letter once I know what information they have looked at to make their initial decision. Also I requested for a credit increase which the company approved because of my excellent credit score so how can DWP presume that i would have always had over £6k available to me? As you may know credit card companies are always increasing and decreasing customers balances. From all the guidelines i have read a loan or credit card is not mentioned as form of capital or income. If I had know all of this I would never have agreed to help my friend.

Izzy_Ziddi

I have only just received a letter with outcome of the Compliance investigation but as the letter is very basic I have requested a more detailed explaination. How is having credit cards classed as personal capital when it doesn't belong to me and ultimatley has to be repaid with interest? If I have had credit cards, which I have for over 20 years and chosen not to use them are they saying instead of claiming Income Support i should have used my credit card? I plan to write a MR letter once I know what information they have looked at to make their initial decision. Also I requested for a credit increase which the company approved because of my excellent credit score so how can DWP presume that i would have always had over £6k available to me? As you may know credit card companies are always increasing and decreasing customers balances. From all the guidelines i have read a loan or credit card is not mentioned as form of capital or income. If I had know all of this I would never have agreed to help my friend.

poppy12345

You transfered money from your credit card into your bank. This isn't the same as using your credit card to pay for something.

BorisThomson

The issue is not you having credit available to you, but you using that credit to withdraw/ transfer cash to your current account. Once you do this that money stops being available credit and becomes capital, and subject to capital rules.

Izzy_Ziddi

The fact it was transferred in and out over 1-2 days and my claim stopped within a week of this then shouldn't the overpayment be for that period of time and not for the whole duration of my claim?

BorisThomson

Izzy_Ziddi wrote: »

The fact it was transferred in and out over 1-2 days and my claim stopped within a week of this then shouldn't the overpayment be for that period of time and not for the whole duration of my claim?

It should be from that point that you accepted the money as your capital. Your choice to then lend it out is irrelevant, it is still your asset, and if you argue it is not (that you don't expect the money back) then it will fall under the deprivation of capital rules.

Izzy_Ziddi

The credit card money is obviously expecting their money back which is being repaid on a monthly basis so how they can say i'm depriving myself is beyond me because had I not done a favour for a friend I wouldn't have ever thought that borrowing money for whatever reason means having capital. I will request a MR and see what the outcome is because i'm not satisfied that I should be liable for the whole duration of my claim.