Migration from benefits to UC questions? Saving etc?

Spoonie_Turtle

Shirker_Bee said:

Which works out at an annual take-home of £53,642.76

The person earning that amount via working will hand over a third of that in income tax. Where you don’t - something is wrong somewhere. 

Yes, your assumption.

A person taking home £53,000 will be earning a gross salary of getting on for £80,000, or higher if they put more than the standard amount into a pension pot.

Claiming benefits doesn't somehow mean you don't pay income tax and NI if you reach the relevant thresholds.

kaMelo

Shirker_Bee said:

Which works out at an annual take-home of £53,642.76

The person earning that amount via working will hand over a third of that in income tax. Where you don’t - something is wrong somewhere. 

That figure is already net of deductions, that is how UC is calculated. To achieve take home pay of that amount the gross salary required is around £78,000 (assuming minimum pension contributions only. )

sunnyhampshire

these figures are mind blowing and why tc were a bad idea and the op is upset that uc wont pay his impending mortgage and could end up in poverty
dont post much but this is a joke trying to play the system at the very extreme

blackstar

Sunny Hampshire. Totally wrong trying to ensure we stay within the rules of UC. 
Buying a house means less money from the tax payer as we won't get the mortgage paid under UC but if we rented we would. 
Trying to get yourself out of poverty but UC keeps you from being able to save to buy a house or say start a business.

Anyhow in reponse to the helpful posters.

 I was reading the below threads and I can certainly see that from those threads UC have seen someone using capital to buy a house as deprevation of capital. 

But what about using it to put a deposit down on a house? Is that pretty much the same thing?

What about if we were to put a deposit down on a property and starting a mortgage before switching over to UC ie when on Tax credits before even getting the migration letter?

I mean people get UC while they have a mortgage and even get a break on the tax on their wages if they have a mortgage so how do people buy a house when on UC?

Gosh just don't know what to do?

What if my mother buys a house and rents it to me?

Is having a house but still paying the mortgage considered having capital ie what you have paid already on the loan and the part of the house you own is considered capital and will affect your UC?

https://www.rightsnet.org.uk/forums/viewthread/19649/#92577

https://www.rightsnet.org.uk/forums/viewthread/10780/#49698

https://www.rightsnet.org.uk/Forums/viewthread/15119/#71497

poppy12345

blackstar said:

What if my mother buys a house and rents it to me?

No, that could be treated as a contrived tenancy. See link. https://england.shelter.org.uk/professional_resources/legal/benefits/housing_benefit/housing_benefit_claimants_who_are_treated_as_not_liable_to_pay_rent

poppy12345

Spoonie_Turtle said:

Right, have amended my previous post but for simplicity here is the accurate calculation for the first 12months while you have £16,000+ in savings … but based on rates up until April, so it will all increase after that.

Unless the OP claims UC before the April increase. If they do and their UC includes TP then when benefits increase in April the TP decreases so no overall increase to benefits entitlement. Unless the increase is more than the TP.

blackstar

poppy12345 said:

blackstar said:

What if my mother buys a house and rents it to me?

No, that could be treated as a contrived tenancy. See link. https://england.shelter.org.uk/professional_resources/legal/benefits/housing_benefit/housing_benefit_claimants_who_are_treated_as_not_liable_to_pay_rent

What if my mother uses her money and pays for a deposit for a house directly from her own account for a property for us to live in, without transferring the deposit money to us first? And we are on UC but under the 16k? 

poppy12345

Shirker_Bee said:

Which works out at an annual take-home of £53,642.76

The person earning that amount via working will hand over a third of that in income tax. Where you don’t - something is wrong somewhere. 

There's a sticky at the top of the forum, you can read it here. https://forums.moneysavingexpert.com/discussion/365935/its-about-helping-people-get-their-entitlement-not-about-benefits-policy#latest

poppy12345

blackstar said:

poppy12345 said:

blackstar said:

What if my mother buys a house and rents it to me?

No, that could be treated as a contrived tenancy. See link. https://england.shelter.org.uk/professional_resources/legal/benefits/housing_benefit/housing_benefit_claimants_who_are_treated_as_not_liable_to_pay_rent

What if my mother uses her money and pays for a deposit for a house directly from her own account for a property for us to live in, without transferring the deposit money to us first? And we are on UC but under the 16k? 

I still can't see how using your savings for a deposit on a property you intend to live in can be treated as deprivation of capital. We seem to be going round in circles here. We are now on page 7.

blackstar

Yes Poppy I can't see how using savings for a deposit on a property can be deemed deprevation of capital at all. But makes me nervous when I read this.

https://www.rightsnet.org.uk/forums/viewthread/19649/#92577

Anyome know if my mother was to use her own money directly to pay for a deposit for a property for us, never even going into our own account? Would that affect our UC if getting UC and between 6k - 16k in savings?
Ie the deposit was sent directly to my solicitor I don't see any of it. The mortgage goes directly to solicitor from the lender I see none of it?
Then just add the increased Work Allowance once moving into the new home?
Even that option makes me a little nervous as I read this:


https://www.rightsnet.org.uk/forums/viewthread/12063/#55795

At the very end you don't find out what the client ended up doing or what the clients representative advised them to do. There was an argument that the money tranfered from the parent to the solicitor somehow belonged to the UC client and may still needed to be declared to UC and wether UC wpuod consider this a deprevation of capital and if the money belonged to the UC client even briefly. There doesn't seem to be any conclusion in this thread. 

I also read this but don't know if theres been any progress with it.

https://www.insidehousing.co.uk/news/government-to-change-universal-credit-rules-to-allow-recipients-to-save-for-a-deposit-76026