Help! Am I in trouble? (ESA/HB savings limit)

davidjoel

I've been on ESA for a long time (I think contribution based and support group).
I was stable with savings around 15000
This year I applied for pip, and suddenly got the award plus £1000 backdated. Then I got £800 backdated because I qualified for severe disability premium.
This sent me over 16k, but I know they won't count that £1800 when they look at my finances.
However, they've just asked me to send my bank account details and due to having a flood of money and not yet updating my lifestyle to suit (I am desperate to move because I have absolutely no space in this crummy studio flat and was saving for furniture), I had about 18.1k in the bank. So even with the deductions, I am over. Now, there are things I could buy to bring me back down, not frivolous things.. but the fact is that the bank statement will show that I've been slightly over 16k in the last few months, even ignoring the 1800.

What will happen? What should I do?
Please help.

poppy12345

Contributions based ESA isn't means tested so any savings/capital are ignored.

As the SDP is included in your ESA then at least part of it is Income Related, which is means tested. You should have reported the changes when they reached £6,000 because every £250 or part there of over this amount and your ESA is reduced by £1. For savings of more than £16,000 then entitlement to all means tested benefits end.

Any overpayment will need to be repaid back.

Are you claiming for help with any rent through housing benefit? If so then the savings rule applies to this too. You will need to ring your local Authority to report the changes.

For council tax reduction some local Authorities have a savings limit of £6,000 before entitlement to CTR ends. Any overpayment for both of those will also need to be repaid back.

You may also have a fine on top for not reporting the changes.

davidjoel

poppy12345 said:

Contributions based ESA isn't means tested so any savings/capital are ignored.

As the SDP is included in your ESA then at least part of it is Income Related, which is means tested. You should have reported the changes when they reached £6,000 because every £250 or part there of over this amount and your ESA is reduced by £1. For savings of more than £16,000 then entitlement to all means tested benefits end.

Any overpayment will need to be repaid back.

Are you claiming for help with any rent through housing benefit? If so then the savings rule applies to this too. You will need to ring your local Authority to report the changes.

For council tax reduction some local Authorities have a savings limit of £6,000 before entitlement to CTR ends. Any overpayment for both of those will also need to be repaid back.

You may also have a fine on top for not reporting the changes.

They know I have over 6000, I've been sending them my bank statements each year and they've been deducting appropriately.
I'm just worried because I've gone over 16000 (even removing the 1800 backdated payment).
However, looking closely at my bank statement, it looks like I have actually only gone over 17800 (my assumed cap because of the backdated payments), this week. Literally this one week, and its the week the demand full itemised statement. And literally I am only over because of housing benefit. I get it on thursday, and it leaves my account on tuesday. Once it's gone i will be under 17800. Would that help me?

Also, I've not paid electric in 2 years. They just don't send me bills. I contacted them twice to remind me to send them bills, and they don't.. so I just said, well, if you won't send them to me then it's not my burden to keep reminding you. But I have been retaining money for that bill to come, although they can only request the last year, it is still likely to be 1000 or so. Can I use that debt to offset my balance?

poppy12345

Your payment of benefits are not classed as capital until the end of the period they are paid for. Therefore the housing benefit you received wouldn't have been taken into consideration as savings.

The PIP and SDP money that was owed to you will be disregarded for 1 year.

davidjoel

poppy12345 said:

Your payment of benefits are not classed as capital until the end of the period they are paid for. Therefore the housing benefit you received wouldn't have been taken into consideration as savings.

The PIP and SDP money that was owed to you will be disregarded for 1 year.

Thankyou. That's a relief. 
Do you have any idea if I could use what I owe to electric to effectively offset my bank balance? So they will say "well, you have 15.9k this year but because you've owed 1k to electric this whole time, and then you paid it, we're going to say you had 14.9k this year"?

HillStreetBlues

davidjoel said:

poppy12345 said:

Your payment of benefits are not classed as capital until the end of the period they are paid for. Therefore the housing benefit you received wouldn't have been taken into consideration as savings.

The PIP and SDP money that was owed to you will be disregarded for 1 year.

Thankyou. That's a relief. 
Do you have any idea if I could use what I owe to electric to effectively offset my bank balance? So they will say "well, you have 15.9k this year but because you've owed 1k to electric this whole time, and then you paid it, we're going to say you had 14.9k this year"?

No they won't, a debt doesn't counteract a credit.

For example if you take a £5000 loan  once that money is in your account you are classed as having £5k in capital

Spoonie_Turtle

davidjoel said:

poppy12345 said:

Your payment of benefits are not classed as capital until the end of the period they are paid for. Therefore the housing benefit you received wouldn't have been taken into consideration as savings.

The PIP and SDP money that was owed to you will be disregarded for 1 year.

Thankyou. That's a relief. 
Do you have any idea if I could use what I owe to electric to effectively offset my bank balance? So they will say "well, you have 15.9k this year but because you've owed 1k to electric this whole time, and then you paid it, we're going to say you had 14.9k this year"?

No, because debts don't offset a credit as already commented - but even if they did, until you've been billed for your electricity it's not officially a debt anyway. 

You'll only not have that 1k once you've actually paid it.

Edited: wrong word distorted meaning

born_again

davidjoel said:

poppy12345 said:

Contributions based ESA isn't means tested so any savings/capital are ignored.

As the SDP is included in your ESA then at least part of it is Income Related, which is means tested. You should have reported the changes when they reached £6,000 because every £250 or part there of over this amount and your ESA is reduced by £1. For savings of more than £16,000 then entitlement to all means tested benefits end.

Any overpayment will need to be repaid back.

Are you claiming for help with any rent through housing benefit? If so then the savings rule applies to this too. You will need to ring your local Authority to report the changes.

For council tax reduction some local Authorities have a savings limit of £6,000 before entitlement to CTR ends. Any overpayment for both of those will also need to be repaid back.

You may also have a fine on top for not reporting the changes.

They know I have over 6000, I've been sending them my bank statements each year and they've been deducting appropriately.
I'm just worried because I've gone over 16000 (even removing the 1800 backdated payment).
However, looking closely at my bank statement, it looks like I have actually only gone over 17800 (my assumed cap because of the backdated payments), this week. Literally this one week, and its the week the demand full itemised statement. And literally I am only over because of housing benefit. I get it on thursday, and it leaves my account on tuesday. Once it's gone i will be under 17800. Would that help me?

Also, I've not paid electric in 2 years. They just don't send me bills. I contacted them twice to remind me to send them bills, and they don't.. so I just said, well, if you won't send them to me then it's not my burden to keep reminding you. But I have been retaining money for that bill to come, although they can only request the last year, it is still likely to be 1000 or so. Can I use that debt to offset my balance?

You really should be chasing them more often. I hope that you have a record of the meter readings. 👍
Might be worth posting in the energy section about this with company.

But I would certainly be sending them a complaint about this. Can be via email.

Bigwheels1111

Pay all your debts first, that can’t be hard against you.
My friend had similar issues last year, was owed 14 months of PiP & Mobility just under 11k.
Within 2 days of payment he had cleared credit cards, loans, Gas & Electricity, council tax, years car insurance, repair bill and service. After that he was well under 16k.

poppy12345

Bigwheels1111 said:

Pay all your debts first, that can’t be hard against you.
My friend had similar issues last year, was owed 14 months of PiP & Mobility just under 11k.
Within 2 days of payment he had cleared credit cards, loans, Gas & Electricity, council tax, years car insurance, repair bill and service. After that he was well under 16k.

That money that was owed to them was disregarded for 1 year and during that time, you can do what you want with that money.

Newcad

The 2 backpayments that you got (£1,800 total) are disregarded as savings for a year from when they were paid, so don't affect your Income Related benefits for that year.

If you want to then when you send in your bank details add a covering letter reminding them that £1,800 of it is benefits backpayment so should be disregarded.

Within that year you can spend the backpayment money on whatever you want to.

After the year is up then any of the back-payment money that is left becomes just savings and so is then added to the rest of your savings when calculating Income Related benefits.

(I often advise putting any large sums of benefits backpayment money into a seperate account, so that it's clear that it is the backpayment money and not 'normal' savings - just don't forget to spend it on things you want/need and lot leave it sat there).