customer compliance letter about undeclared savings

relay

seven-day-weekend wrote: »

The OP considered the money to be her son's.

Yes, but from her account of the story it wasn't in her son's account when she claimed Income Support - therein lies the problem.

Alfie_E

I wouldn’t say you’ve “messed up”. It’s an administrative problem.

Thriftylad wrote: »

If the money was left to you with the express intention of being spent on your son then a (albeit informal) trust has been created.

This is basically right, but Thriftylad has implied the money was given to you. This is something you specifically avoided saying in your first post. You said, “told me to keep it safe for my severely disabled son.”

In law, there are two sorts of ownership of property. Property is money, shares or any other assets.

• Beneficial ownership. This is the person to whom the property truly belongs.
• Legal ownership, also sometimes called title. This is the person whose name is recorded against the property. This is the person who deals with any legal or administrative issues.

The recent Labour party donation fiasco shows the difference. It didn’t matter who the legal owner of the money was. It didn’t matter whose names were on the cheques. Mr Abrahams was the true owner, the beneficial owner, and that was the problem.

When you had your son’s money in a bank account in your name, this was a bare trust. Your son was the beneficiary. You were the legal owner, here called the trustee. This informal arrangement contrasts with what people usually think of a trust. When people think of a trust, it’s usually when a professional creates paperwork, a deed, to make a trust that often exists independently of the beneficiaries and trustees. A bare trust can be created by deed, but a deed is not necessary. It can be the informal arrangement you had.

Anyone trying to give any more detailed advice will need to know the exact circumstances surrounding the gift. Was the money transferred from your father while he was still alive, called a lifetime gift? Or, was the money transferred after death, as part of his will or by intestacy (by default, because there was no will)? If your son was named in a will, I assume the money went into an account in your name because your son was not old enough or otherwise not capable of managing his own affairs. In a case like that, a deed of trust should have been set up. That would have been the responsibility of whoever dealt with the will.

tinsel_2

My father was very ill and was fighting cancer. He did not leave a will as I was his only child. He gave me some of the money when he was dying and the rest was after he died. He pumped it into my head over and over throughout his illness that the money was for my sons future to be kept for any emergencies as my sons health is so bad .My son is severely disabled and he can't even sign his name. My mother and other members of my family knew of his wishes.

Alfie_E

tinsel wrote: »

He gave me some of the money when he was dying… My mother and other members of my family knew of his wishes.

Here you could make a strong case that the money has always been your son’s. You can make a statement to that effect. Hopefully, you have other family members who can do the same. Because the amount of money is relatively small, I don’t suppose you needed to apply for a Grant of Letters of Administration, so there would never have been any need to even given an indication about any lifetime gifts. Letters of Administration is like probate, but when there’s no will. The money was given a long time ago, and it would be unreasonable to expect there to be any other form of paper record. Your actions have always been consistent with the money belonging to your son.

tinsel wrote: »

He did not leave a will as I was his only child.

There are very specific rules that determine what happens when someone dies without a will. Although it doesn’t sound like it, I need to check if your father was married at the time he died. If he was, an initial, quite large chunk of money would then belong to his wife. Also, anything jointly owned goes to the surviving owners. Next in line would have been you. See this Intestacy rules guide. Any money passing to you this way was beneficially yours. It’s not possible to say it went straight from your father to your son. Shortly after your father’s death, it may have been possible to do something about this. You might have been able to refuse the money and have it pass on to your son directly.

However, if you were not receiving Income Support or other means-tested benefits at the time your father died and didn’t go on to claim any soon afterwards, there’s the potential to argue you yourself gifted the money to your son. That, on the day you received your father’s money you immediately gave it on to your son. You have specific circumstances. You couldn’t have written out a cheque and handed it over to him.

As Thriftylad has said, you certainly need to visit Citizens Advice or Welfare Rights. We’re talking about fairly complex details relating to your special circumstances. I wonder if you could get proper legal support from a disability charity. There are other issues. There’s a problem if you put some of the money in ISAs in your own name. When you put money in an ISA, you’re declaring that you’re both the legal and beneficial owner, and you’re not looking after it for someone else. But don’t worry. HM Revenue & Customs aren’t going to care. If you weren’t using your son’s own ISA and tax allowances, you could have paid too much rather than too little tax. Have you made any claim on behalf of your son for a means-tested benefit? Was the £20,000 declared then? I assume he receives DLA, which isn’t a problem as it’s not means-tested.

lilac_lady

Presumably you gained interest on the £20000. When you filled out the forms claiming IS and Housing Benefit (if you claimed that) you have to declare it under any other income. Did you fill out any tax forms and declare the interest? I would write down exactly what happened and where the money was and hope that they are symathetic towards you. You'll not go to prison so don't worry about that.

Alfie_E

lilac_lady wrote: »

When you filled out the forms claiming IS and Housing Benefit (if you claimed that) you have to declare it under any other income.

For Part 7 of the Income Support claim form, Other people who live with you, reads as follows.

We need to know if any of the people living with you have any money coming in.
You do not have to answer these questions but if they do not have much money coming in, you may get more Income Support.

If tinsel’s son receives DLA, I believe there’d be no advantage in filling it in. When considering if a reduction should be made because there are other people in the household, the DLA would mean he is discounted.

roddydogs

So anyone caught in the same situation should just say "It wasnt my money it was for my son/daughter/father/mother etc, etc. and that means nothing will happen ??

swanny65

Four quick points

1. Customer compliance officers dont prosecute DWP offences, there job is to correct benefit claims and get overpayment decisions issued where needed. However you are fortunate with that amount of capital the matter was passed to compliance and you are not being interviewed under caution by a fraud officer.

2. The money will be treated as yours as it was left to you. If your late father wanted his grandson to receive it he should have stipulated this, usually in a will, before he died. This prevents Roddydogs situation occuring.

3. How many Income Support claim forms have you completed? There are questions on the claim form where you could and should have explained the capital.

4. An appeal is your most likely, but slim, chance of success. Even though tribunals should apply the law sometimes personal feelings come into play and you may get a sympathetic tribunal. If you did win the DWP could appeal on a point of law, but that is unlikely to be followed through by the DWP.

I take it your son doesn't claim Income Support or Housing Benefit / Council Tax Benefit. If he does, did he, or you if you deal with his affairs, declare the capital on his claims.

This just emphasises the need to make a will.

cattie

roddydogs wrote: »

So anyone caught in the same situation should just say "It wasnt my money it was for my son/daughter/father/mother etc, etc. and that means nothing will happen ??

A very high percentage of people who are found to have undeclared capital by DWP do claim the money belongs to a relative & that they were only looking after it on their behalf. As such, DWP is very used to this happening & do tend to expect this response.

Unfortunately, if the said relative is willing to say money is actually theirs & provide a statement to this effect then it is difficult for the DWP to prove otherwise.

Another thing that happens often is claimant is found to have undeclared capital by DWP & when contacted by DWP about it, claimant withdraws savings & claims to have returned it to relative, for whom they were looking after it, & now said relative has mysteriously disapeared & thus cannot give supporting evidence to say that the money was being looked after on their behalf by claimant. :rolleyes:

real1314

I'm not convinced that some of these replies are helpful, the Op needs to see CAB, welfare rights or some other org who can get deeper into this without compromising themselves.

I don't think bandying about explanations of how some people evade prosecution/action is a good idea? The point of this board is to help people get what they are entitled to, not explain how some people get what they shouldn't.