Home Loss Compensation Payment

[Deleted User]

I’ve been informed I have to move out by the housing association as they are pulling my block of flats down but they’ll work with the tenants to find a new place to live. 

They have offered all tenants a £6500 home loss compensation payment & reimbursement of removal costs. 

I’m on legacy benefits, IR JSA, CTR & HB. 

Does anyone know if these sort of payments get classed as savings or get disregarded? 

I don’t have a problem reporting it if I need to, it’s just once I receive the money once I move out, it’s going to need reporting then possibly days later I’ll drop below the savings limit anyway as I’ll need to buy new carpets, curtains, paint, pay for decorators and possibly a few new bits of white goods as some of my current bits are the landlords and they want it back and expect us to buy our own from the money which is fine with me as that’s what it’s for. 

So is it best to just keep receipts to show I’ve had to spend it on this stuff? 

calcotti

I can’t find an obvious disregard. The first £6000 of capital is disregarded anyway so, if you currently have no capital, only £500 would impact on your benefits. 

If you are going to spend some of the money almost immediately I would be inclined to only report it after you have already spent some. Then you can just say I received £6500 on X date to compensate me for the loss of my home. I spent £zzz on to purchase abc. My capital is now £y. Benefits can then be adjusted, if necessary for a closed period. 

[Deleted User]

calcotti said:

I can’t find an obvious disregard. The first £6000 of capital is disregarded anyway so, if you currently have no capital, only £500 would impact on your benefits. 

If you are going to spend some of the money almost immediately I would be inclined to only report it after you have already spent some. Then you can just say I received £6500 on X date to compensate me for the loss of my home. I spent £zzz on to purchase abc. My capital is now £y. Benefits can then be adjusted, if necessary for a closed period. 

Thanks for the response I really appreciate it.

Yes, I had an extensive look round various sites and could not find any specific information. 

pmlindyloo

The Jobseeker’s Allowance Regulations 1996 (legislation.gov.uk)

Do you think this covers it?

13.  Any sum—

(a)paid to the claimant in consequence of damage to, or loss of, the home or any personal possession and intended for its repair or replacement; or

(b)acquired by the claimant (whether as a loan or otherwise) on the express condition that it is to be used for effecting essential repairs or improvements to the home,

and which is to be used for the intended purpose, for a period of 26 weeks from the date on which it was so paid or acquired or such longer period as is reasonable in the circumstances to enable the claimant to effect the repairs, replacement or improvements.

calcotti

pmlindyloo said:

The Jobseeker’s Allowance Regulations 1996 (legislation.gov.uk)

Do you think this covers it?

13.  Any sum—

(a)paid to the claimant in consequence of damage to, or loss of, the home or any personal possession and intended for its repair or replacement; or

(b)acquired by the claimant (whether as a loan or otherwise) on the express condition that it is to be used for effecting essential repairs or improvements to the home,

and which is to be used for the intended purpose, for a period of 26 weeks from the date on which it was so paid or acquired or such longer period as is reasonable in the circumstances to enable the claimant to effect the repairs, replacement or improvements.

I think it does. I found that yesterday but misread it as a) and b) and didn't think the payment would come under b). I now see that it says a) or b). Looks as if it is covered by a) so the 26 week disregard would apply.

OP. You can either report but say that you understand it is disregarded or not report it but make sure you keep records of what you received and how you spent it just in case you are asked about it in the future.

pmlindyloo

The alternative is to write to the DWP and explain the situation. The link could be quoted and ask whether the future expenditure would be allowed.

This then covers the need to report the increase in capital (as required) and, also, gives the OP peace of mind.

Permission given then takes away any problem with deprivation of capital.

What the OP intends to do with the money is, in my view, not deprivation of capital. However, I do think the need to notify any increase in capital is something that should be done.

[Deleted User]

Oh I appreciate all of your help, all contributions are appreciated. 
So that I have a record, once I receive the money, I will send them a letter so I have some evidence or what I have told them, alongside keeping receipts, etc too. 
Im guessing the CTR and HB rules in relation to this sort of compensation will vary from council to council and im best placed to speak with my council direct to check their rules?

calcotti

HB rules will be standard. Without check the Housing Benefit guidance I am fairly confident there will be a similar provision to that for JSA. CTR rules can vary between councils although some provisions are required.

[Deleted User]

calcotti said:

HB rules will be standard. Without check the Housing Benefit guidance I am fairly confident there will be a similar provision to that for JSA. CTR rules can vary between councils although some provisions are required.

Thank you, I’ll have a look into it. 

[Deleted User]

I found this in the HB 2006 regs:
"10.  Any sum—

(a)paid to the claimant in consequence of damage to, or loss of the home or any personal possession and intended for its repair or replacement; or

(b)acquired by the claimant (whether as a loan or otherwise) on the express condition that it is to be used for effecting essential repairs or improvement to the home,

which is to be used for the intended purpose, for a period of 26 weeks from the date on which it was so paid or acquired or such longer period as is reasonable in the circumstances to effect the repairs, replacement or improvement."

Is this the correct bit in relation to the circumstances do you think?

calcotti

Yes, as expected, it mirrors the clause in the JSA regulations.