DWP Overpayment request/Liability

MICKIE

Hi everyone,

I am hoping that someone could answer a question which is causing my 80 year father a lot of distress.

My grandma died back in Apr, we have done the probate and have received a letter from the DWP asking for various financial information to check that she was not being overpaid for, presumably, her pension credit & attendance allowance.

My father is the executor and also the main heir to her assets, excluding small payment to grandchildren. She only had £12k in cash & insurance policies including a funeral plan. Her house is worth £120k.

The estate was under the inheritance tax threshold. The intention was to sell the house and pay the beneficiaries.

There is absolutely no problem in paying back the overpayment should they decide there is one. However, what is causing him a great deal of worry is that the documents from DWP say that the executor is personally liable for any amount due.

He called the "Recovery from Estates" customer care line and they explained that this is correct. I also confirmed this with them. Obviously he is now gravely concerned that if there is an overpayment which is greater than the combined value of assets (£130k ish) he will have to sell his own house and use his own savings to pay it which seems extremely unfair.

Can anybody please tell me if this could actually happen. It just seems completely unbelievable.

Thanks in advance for any comments.

Flugelhorn

I am sorry that you are having to handle this. One thing to say is that there is no way that your father would have to use his own savings / assets to pay any debts of your grandmother. If perchance the debt was greater than the estate then the creditors lose out.

The bit about the executors being liable refers to when an executor distributes an estate and then says "oh dear can't pay DWP back as have given all the money the beneficiaries" - this is why it has to be sorted before the distribution.

This has come up because the probate figure appears to be higher than would have been declared at the time she claimed income related benefits.

In all probability she had little in the bank at the time of claiming (the threshold is 10k now) and the reason the figure is higher now is because of the value of the house (which was not relevant to the benefit calculations)

I don't think attendance allowance is included anyway as that is not income related so just likely to be pension credit.

To reassure yourself, see if you can find out how much pension credit she was getting ans see how much this adds up to

jimbo6977

Over her lifetime did she actually receive £130k in DWP payments?

dresdendave

I'm no expert but I think it's the estate that would be responsible for paying back the overpayment. The executor would only become personally liable if he/she paid out all the money in the estate to the beneficiaries and a DWP demand then appeared.

Guideline would be don't pay out any beneficiaries until you have the all clear from the DWP or any other potential creditors.

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I'm a very slow typist, other replies have said much the same.

MICKIE

She died at age 99 and was receiving her standard state pension plus an additional £166 per week in pension credit.

I believe she only started recieving the pension credit 20 years ago. so calculating the pension credit figure x 20 years I get a total of £172,640.

Obviously it wouldn't have been that exact amount for the entire 20 years, but that total is still over the total value of the estate.

I forgot to mention that she did have regular financial assessments from social services and everything except a funeral plan was declared as we didn't know the value of this at that point.

Skiddaw1

....In addition, I'd be pretty certain that either there's no overpayment whatsoever or if there is, it'll be WAY less than that. Honestly, DWP send those letters out as a matter of form so please tell him not to lose any sleep over it. If they do decide there's a recoverable overpayment please do seek advice. I was a welfare rights person for well over 20 years and believe me, those decisions are nearly always worth challenging...


Edited to say: based on her age when she died, she'd almost certainly have been in what was known as an 'Assessed Income Period' (AIP) throughout the time she was receiving Pension Credit in which case, any changes to her 'retirement provision' (including increases in her capital) wouldn't have affected her ongoing award. So I'm even more inclined to believe it's MOST unlikely she was overpaid.

MICKIE

dresdendave wrote: »

I'm no expert but I think it's the estate that would be responsible for paying back the overpayment. The executor would only become personally liable if he/she paid out all the money in the estate to the beneficiaries and a DWP demand then appeared.

This is what I would have thought too.

However, they have informed him that as the executor of the estate he is personally liable if the overpayment is more than the value of assets.

He isn't going to pay any beneficiaries but he is extremely worried he will have to use his personal savings to settle any bill.

It makes me think that it is never a good idea to take on the executor role of anyone's estate in the future if it will jeopardise your own finances.

Mojisola

MICKIE wrote: »

My grandma died back in Apr, we have done the probate and have received a letter from the DWP asking for various financial information to check that she was not being overpaid for, presumably, her pension credit & attendance allowance.

My father is the executor and also the main heir to her assets, excluding small payment to grandchildren. She only had £12k in cash & insurance policies including a funeral plan. Her house is worth £120k.

This will have been the standard letter that many of us received as executors. In most cases, there is no overpayment - it's just that the estate includes the value of the house so it looks as if the deceased had more money than they said when they claimed a means tested benefit.

Please reassure your father that he has no personal liability to pay anything but it's most likely that there is no overpayment anyway.

The DWP can be very slow so be patient.

Don't pay them anything unless they can show the evidence that an overpayment was indeed made.

Mojisola

MICKIE wrote: »

However, they have informed him that as the executor of the estate he is personally liable if the overpayment is more than the value of assets.

This is just plain wrong.

MICKIE

[QUOTE

In all probability she had little in the bank at the time of claiming (the threshold is 10k now) and the reason the figure is higher now is because of the value of the house (which was not relevant to the benefit calculations)


To reassure yourself, see if you can find out how much pension credit she was getting ans see how much this adds up to[/QUOTE]

She had £5k in cash but an insurance policy and funeral plan took the value to £12k, so i guess that means that she was over the limit-I didn't realise it had changed from £16k.

She received £166 per week of pension credit and was receiving this for near on 20 years, but obviously it wouldn't have been that amount to begin with.

MICKIE

Mojisola wrote: »

This is just plain wrong.

I know, but when we called the Debt Recovery Team at DWP they told me this is true.

I can't believe it.