Uc and inherited house, own half other owner buying out.

Leah30

I have just inherited 50% of a house. My brother got the other 50% but he plans to buy me out in time. I am not charging rent. 
My partner is a carer to our eldest child who is sen  and unable to work at the moment. I work full time.
Currently on tax credits but will be moved to universal credit at some point soon. Would this affect any universal credit claim? 

TELLIT01

Are either you or your brother currently living in the property?

Leah30

My brother is planning on moving in, in March

HillStreetBlues

What's the time-frame of your brother buying you out? How much is your share of house worth?

Leah30

Approx £100,000, but it is in need of a lot of work. 
Time frame is hard to say but ideally less than 3 years.

TELLIT01

I think there may be problems on a number of counts, not least the timescales if a Decision Maker did say the property could be disregarded for a period of time.  As neither of you are living in the property, and were not doing so at the time of the bequest, I think it more likely that you will be classed as having the half share from the date the estate was finalised.  You need to inform UC as soon as possible about the situation and see what decision they come to.  Not doing so is only likely to result in an overpayment.

Hermann

Leah30 said:

I have just inherited 50% of a house. My brother got the other 50% but he plans to buy me out in time. I am not charging rent. 
My partner is a carer to our eldest child who is sen  and unable to work at the moment. I work full time.
Currently on tax credits but will be moved to universal credit at some point soon. Would this affect any universal credit claim? 

Although I don't know the answer to your question I notice you are currently on Tax Credits. Such capital or asset doesn't end your Tax Credits but would exclude you from UC (unless there is some disregard for your specific circumstance).

However if you wait until you get a Migration Notice to be moved from TC to UC then you should get 'transitional capital disregard' which will give you a year of UC with the capital disregarded, after that I think your UC would probably end.

Not 100% sure on the exact details but just a pointer to something to explore.

 

HillStreetBlues

Leah30 said:

Approx £100,000, but it is in need of a lot of work. 
Time frame is hard to say but ideally less than 3 years.

Do you currently have capital (excluding house) over £16k?

Leah30

HillStreetBlues said:

Leah30 said:

Approx £100,000, but it is in need of a lot of work. 
Time frame is hard to say but ideally less than 3 years.

Do you currently have capital (excluding house) over £16k?

No, just the 50% of the house.

HillStreetBlues

With UC  a Decision Maker will look at the property  and see if it can be disregarded as you don't have any beneficial interest in it. With joint owners a property can be harder to sell and they must take account of that. But 3 years is a long time so it could be decided the the delay is contrived to allow you to keep claiming UC.

I feel all you can do is when you move over to UC declare the property and see what the decision is. If it decided to disregard the property then UC will continue as long as it's disregarded. If it's not disregarded from start of claim,  UC will end after 12 months, as you are allowed capital over £16k for a year when transfering from TC.

Yamor

As mentioned above, your share of the value of the house could be treated as being very low, particularly if your brother (who is a joint owner) is living there, as it can be very difficult to sell the property in those circumstances. In fact, there's case law which states that often in these circumstances the value could even be nil.

However, there is another potential get-out: if your brother is over pension age, or has 'limited capability for work' (for example, if he gets UC or ESA), then the value of the property is ignored completely for as long as he is living in it.