Inheritance Dilemma

NJL1969

My partner's father has recently passed away and my partner and his brother are his beneficiaries, they will inherit his flat which he owned outright.    He and his brother have not decided what to do with the flat, ie:  rent it out or sell it.   For my partner, each option has problems attached to it:   he claims income based ESA.   He will have to declare the inheritance  - although I have seen on some websites that there are some benefits where an inheritance doesn't affect a benefit claim but we are both in the dark about this.

If they rent the property, my partner's only income will be half the rental income, having declared to the DWP and presumably losing his benefit.   If they sell the property, my partner's ESA claim will (presumably) end and he will have to use the inheritance to live off.    Is this correct?

Another option would be for him to move into the flat himself and pay his brother half the rental income but again, presumably his ESA claim would end and he would have no income so wouldn't be able to pay the rent?  Is this correct?

He has no intention of not declaring his inheritance to the DWP but we want to be sure that we aren't missing something and that there isn't a way he can legally and honestly benefit from his inheritance which doesn't affect his claim - does anyone have any advice?   Thank you.

   

calcotti

You refer to your partner, are you living together and are there any other benefits you are claiming.

The half share in the property will count as capital and if over £16,000 will end entitlement to income based benefits such as ESA, HB AND CTR. The value can be ignored for six months if the property is put up for sale.

Worth checking whether the ESA is entirely income based or whether it is partly contribution based with an income based top up. Any contributions based part would not be affected.

if he moves into the flat the value of his share will be ignored so ESA will continue but he will not be able to claim Housing Benefit to help with the to payable to brother.

if his benefits stop he can claim again when capital drops below £16,000 but will have to claim UC rather than ESA.

pmlindyloo

NJL1969 said:

My partner's father has recently passed away and my partner and his brother are his beneficiaries, they will inherit his flat which he owned outright.    He and his brother have not decided what to do with the flat, ie:  rent it out or sell it.   For my partner, each option has problems attached to it:   he claims income based ESA.   He will have to declare the inheritance  - although I have seen on some websites that there are some benefits where an inheritance doesn't affect a benefit claim but we are both in the dark about this.

If they rent the property, my partner's only income will be half the rental income, having declared to the DWP and presumably losing his benefit.   If they sell the property, my partner's ESA claim will (presumably) end and he will have to use the inheritance to live off.    Is this correct?

Another option would be for him to move into the flat himself and pay his brother half the rental income but again, presumably his ESA claim would end and he would have no income so wouldn't be able to pay the rent?  Is this correct?

He has no intention of not declaring his inheritance to the DWP but we want to be sure that we aren't missing something and that there isn't a way he can legally and honestly benefit from his inheritance which doesn't affect his claim - does anyone have any advice?   Thank you.

   

It is probably a good idea if we can confirm what benefits your partner is actually receiving.

You use the term 'partner'.  That implies that you are living together.  Is that correct?

He needs to look at his ESA award letter and tell us exactly what it says and how much he is receiving.  Plus, is he receiving any other benefits like housing benefit/council tax benefit?

Once we establish exactly what benefits he is receiving we can give further information about the inheritance.

TELLIT01

If your partner's only income is ESA how would he pay half the rent to his brother.  He wouldn't be able to claim HB because he owns the property.  Do you have any idea of the value of the flat?

MovingForwards

He also cannot do a deed of variation to alter the will and have it all go to his brother, as that will be depravation of assets and he will be treated as still having them.

Is the half share enough to buy a small property for himself, I'm assuming he rents now rather than owns.

NJL1969

pmlindyloo said:

NJL1969 said:

My partner's father has recently passed away and my partner and his brother are his beneficiaries, they will inherit his flat which he owned outright.    He and his brother have not decided what to do with the flat, ie:  rent it out or sell it.   For my partner, each option has problems attached to it:   he claims income based ESA.   He will have to declare the inheritance  - although I have seen on some websites that there are some benefits where an inheritance doesn't affect a benefit claim but we are both in the dark about this.

If they rent the property, my partner's only income will be half the rental income, having declared to the DWP and presumably losing his benefit.   If they sell the property, my partner's ESA claim will (presumably) end and he will have to use the inheritance to live off.    Is this correct?

Another option would be for him to move into the flat himself and pay his brother half the rental income but again, presumably his ESA claim would end and he would have no income so wouldn't be able to pay the rent?  Is this correct?

He has no intention of not declaring his inheritance to the DWP but we want to be sure that we aren't missing something and that there isn't a way he can legally and honestly benefit from his inheritance which doesn't affect his claim - does anyone have any advice?   Thank you.

   

It is probably a good idea if we can confirm what benefits your partner is actually receiving.

You use the term 'partner'.  That implies that you are living together.  Is that correct?

He needs to look at his ESA award letter and tell us exactly what it says and how much he is receiving.  Plus, is he receiving any other benefits like housing benefit/council tax benefit?

Once we establish exactly what benefits he is receiving we can give further information about the inheritance.

He's looked at his letter which is inconclusive and when he's phoned previously, two different DWP staff have told him different things, ie:  one said income related, one said contribution based!  He's going to phone again and find out and I will come back to this thread in case you can offer any advice, thank you.   We don't live together, he lives in a rented flat of his own.

NJL1969

TELLIT01 said:

If your partner's only income is ESA how would he pay half the rent to his brother.  He wouldn't be able to claim HB because he owns the property.  Do you have any idea of the value of the flat?

Yes I did mention that in my post.   We think the flat is probably worth about £150,000 but they haven't had it valued yet.

calcotti

NJL1969 said: He's looked at his letter which is inconclusive 

If you are willing to post what is says on the calculation page we may be able to help interpret it.

NJL1969

calcotti said:

NJL1969 said: He's looked at his letter which is inconclusive 

If you are willing to post what is says on the calculation page we may be able to help interpret it.

Thank you very much - I will get the letter from him over the week-end.  He has also been on the phone to them today so I will find out and come back to this.  Thank you for your help.

pbartlett

Your partner could investigate moving into the property and paying his brother market rent for their half. You could see if HB would cover this rent.

Spoonie_Turtle

pbartlett said:

Your partner could investigate moving into the property and paying his brother market rent for their half. You could see if HB would cover this rent.

Already mentioned and dismissed in one of the first replies on the thread.