Deprivation of Assets - Universal Credit

Arthurbear0612

I'm really furious. I am on UC legitimately with less than 6K in savings in my account. I have a new business start up and entitled to no MIF to help support it whilst up and running until August of next year. The business requires me to do a lot of reading and research and training, which obviously means I can't work that much all the time and get paid fees. That also means that I won't be making much in net income for the year by the time I find out what it is by end of tax year next April. I am likely to come into a sizeable chunk of money soon, a transfer from a relative due to an inheritance. This will be £34K or thereabouts. My intention, at age 59, was always to put as much as I legally could into a pension for this year (matched to matched to 80% of my income this year - once I know what it is and do the same at the start of the new tax year in April next year (6th onwards, based on estimated earnings for next year). This would swallow up about £16K of it - at best - based on guestimated net profit revenue from the business, leaving the rest. So I also wanted to put the remainder, once I get it soon, into a long term fixed income bond for 5 years where I can't touch the money until it matures generating an income of 8% interest, which I would also declare to UC as revenue once it comes in every quarter. The problem is this. I rang the UC helpline to find out if I could do all of this, once I get the money. I appreciate that I would need to tell them. Their default position seemed to be that all of these plans would simply be classed as deprivation of assets and that I should use the money to just live on to pay bills in leiu of any UC support, whilst I get my business up and running to MIF which won't be for ages yet.. But this is private money from an external source, not business generated revenue with profit inject. So I fail to see why I should (in theory). I also asked them what I should do to find out what the UC decision makers would decide over whether they would class these plans as deprivation of assets and they said this:


"you need to put the money into the money plans you have in mind first (which are all untouchable long term investment plans) and then provide proof that you have done this. Only then can we decide whether it would be OK for it not to be classed as deprivation of assets and if we do decide it is, you will have to come off UC altogether. "

The problem with this approach is that once I put the money into these plans I won't be able to access them for years - because it will then be tied up to get the kind of interest/income they generate. So I then will be deprived of any money to live on too if I am forced to come off UC.

Also the rules written down, as I can see them, is that DOA is only about savings you can access and don't declare. My plans for this money is for long term growth for my retirement, which would have been the case anyway whether claiming UC or not, not use the money to squander now, especially in lieu of getting the valuable support I need from the Government to help me get my business up and running without any pressure to work flat out or look for work.

So I asked them to make the decision now on what they are likely to decide, before I decide to invest the money if they say it is not DOA, once I get it through, but they won't do it that way. Therefore, I take a huge risk in investing it - as planned - and not getting access to it or any UC thereafter, or I keep it in a savings account and don't then have a need to ask a decision maker in the first place because I won't have deprived them of any assets and would then simply close my UC account because I have too much in savings, even if I invest it as planned afterwards, leaving in as much difficulty as I would be had I invested beforehand and then asked them if it was DOA. The rules regarding this are really silly and unfair.

What do you think I should do? I am sorely tempted to just invest the money as planned and not tell UC about it at all. The rules, from what it says, is that savings are accessible if it counts towards your UC claim award and pensions are excluded too.

The ways things are: they are making it impossible for me to plan ahead, invest for my future and live my life prudently and sensibly to get my business up and running properly in the meantime or at least manage the risk properly without losing out. Does anyone have any suggestions on how to deal with this that is legal (e.g., point me to resources that back up what this UC call centre rep told me). She never gave me any legal resources to draw upon to support her assertions on what UC will do or what is legally acceptable for the state to do in this situation. I fail to see that this is a legal approach to take. The government has to abide by the law just as anyone else does.

Please only respond if you have sufficient expertise to advise. Thank you.

KatrinaWaves

Arthurbear0612 wrote: »

Please only respond if you have sufficient expertise to advise. Thank you.

Did your cheque for this expert advice get lost in the post?

Chrysalis

The DWP are right.

Just because its not from a commercial entity (e.g. wages) it doesnt mean it is exempt.

Means tested benefits is for those who "need" it. If you coming into that kind of money then you dont "need" means tested benefits. The option of paying it into a pension and bonds, is a choice not a necessity and hence its deprivation of capital.

Someone else e.g. may have saved up 40k whilst working, then fell into hard times, and they wouldnt be able to claim UC, it would be unfair on that person if you could then claim UC simply because you got it from a will instead.

So yes you will need to live off it, small luxury spends here and there would be ok, but anything that is deemed to make that capital go down unusually quickly is likely to be looked at for consideration of deprivation.

Spoonie_Turtle

Well I have no expertise to advise but here's a link where you can find all the guidance for decision makers for yourself: https://www.gov.uk/government/publications/advice-for-decision-making-staff-guide

xylophone

Deprivation of Assets - Universal Credit

Mentioned in post 11 here.

https://forums.moneysavingexpert.com/discussion/comment/76279282#Comment_76279282

tomtom256

So let me get this right, you want the tax payer to support you, even though you will have savings of at least £34,000 and your furious because of this?

Daisyone

Irrespective of your question about deprivation of assets I am just wondering where you might get 8% return on a 5 year fixed income bond? I don't believe this to be achievable in the present climate and I wonder if you are being seduced by some marketing material that promises something that is too good to be true.

tacpot12

Arthurbear0612 wrote: »

What do you think I should do?

I think you should, if you receive this inheritance, come off UC and use it to support yourself while you build your business. Your business is the thing that will provide for your retirement, so you should focus on completing the study and training you need to start making a profit as soon as you can.

With this inheritance, you don't need UC and will not have to deal with all the silly rules.

Arthurbear0612

No, I want the taxpayer to supplement my business start up so that I can pay enough tax later on to help fund those who are not as fortunate as I am. I also want to invest into a pension and equivalent pension so that I can live as independently as possible instead of claiming pensioner related benefits I might be entitled to if I spend it all now.

Happy?

Arthurbear0612

No this is an FCA related fixed property bond with yields of 8% income. It is not a growth income bond. I have check the credentials of the scheme, which seems perfectly legitimate to me.

Arthurbear0612

Let's get this straight. You want the taxpayer to fund your enormous capital gain on your home, probably worth thousands of pounds extra each year which is not counted for UC capital, whilst impoverished renters, such as myself - who happen to extract a sum from a greedy relative who managed to seduce a benefactor into leaving him most of the dosh in his Will... and to use what little they have managed to get from this sorry situation, costing me £3000 in legal fees,, to usefully use in old age without it unsettling my new business start up?

What a darned cheek I have...My apologies for being the family scapegoat and for wanting to use my money prudently and sensibly to invest. I suppose I should really go out a buy a pile of brick and build myself a house to live in. Unfortunately, £34k doesn't buy much more than a dog kennel in London.