UC income / savings and Grants from a Charity

Grippo

Hi, I’m looking for some advice please….

I have a terminal illness and I am due to migrate from Tax Credits to UC very soon.

I can no longer work and my income is from benefits. I have some savings below the £16,000 threshold.

I can occasionally apply for various Grants from a great charity to pay for things such as equipment to make my life easier and alternative therapies for my wellbeing.

I have recently found out that these Grants are not taken in to account when you declare you income and savings to UC. Which is great for me, as some of the Grants might take my savings over £16,000 until I use them. Which means my UC would stop.

I think this is also the case for payment gifts from family members?

My main question is should I open a separate bank account for these Charity Grant payments and family gifts? Which would keep things simpler when declaring my income / savings to UC? I would still inform them of this bank account. But it would keep the money separate and I could use the new account to pay for equipment and alternative therapies when required.

Thank you for any advice.

Misslayed

I'm afraid I can't answer your question, someone who can will be along soon. But did you know you can apply for PIP under the 'special rules' as you have a terminal condition?
Wishing you strength to get through what lies ahead. 

Yamor

Gifts and grants are ignored as income but not as capital, unfortunately.

The only way out would be if they were given to you to be used in a specific way, and would otherwise have to be returned. In that case you could argue you are not the beneficial owner of the capital (known as a quistclose trust).

An alternative would be to request for your migration notice to be cancelled on the grounds that you fall within one of the groups currently 'deferred' from the migration process (terminally ill people). But I would obtain specialist benefits advice first.

peteuk

Misslayed said:

I'm afraid I can't answer your question, someone who can will be along soon. But did you know you can apply for PIP under the 'special rules' as you have a terminal condition?
Wishing you strength to get through what lies ahead. 

For automatic PIP sadly you need to be terminal within 12 months (SR1/DS1500) if terminal but likely to live longer than 12 months then you apply for PIP and are assessed IOW PIP assessments.  

OP - There is a lot of debate on the forum about capital above £16K and when to declare it.  It is usually taken that you need to declare savings above £6K on the last day of your assessment period. Although as Yamor says grants are ignored.  If the grant is given to you on day 1 of your assessment period and then items purchased on day 15 then you don't need to declare them as its in and out of your account prior to the last day of your assessment period.   But even if its paid in on day 15 but then spent on day 4 of the new assessment period then as its ignored you don't need to declare it. 

Grippo

Thank you very much to you all for the information.

I am already in receipt of PIP and my prognosis is over 12 months at the moment (I hope!)

The type of grants I get are money towards the advanced payment for a Motability car. So that would usually mean it was in my account then paid towards the new car a couple of weeks later.

Another type of payment is a yearly payment to pay for some complimentary therapy sessions throughout the year. This sort of Grant wouldn’t be fully out of my account for some time.

Yamor

peteuk said:

Misslayed said:

I'm afraid I can't answer your question, someone who can will be along soon. But did you know you can apply for PIP under the 'special rules' as you have a terminal condition?
Wishing you strength to get through what lies ahead. 

For automatic PIP sadly you need to be terminal within 12 months (SR1/DS1500) if terminal but likely to live longer than 12 months then you apply for PIP and are assessed IOW PIP assessments.  

OP - There is a lot of debate on the forum about capital above £16K and when to declare it.  It is usually taken that you need to declare savings above £6K on the last day of your assessment period. Although as Yamor says grants are ignored.  If the grant is given to you on day 1 of your assessment period and then items purchased on day 15 then you don't need to declare them as its in and out of your account prior to the last day of your assessment period.   But even if its paid in on day 15 but then spent on day 4 of the new assessment period then as its ignored you don't need to declare it. 

Grippo said:

Thank you very much to you all for the information.

I am already in receipt of PIP and my prognosis is over 12 months at the moment (I hope!)

The type of grants I get are money towards the advanced payment for a Motability car. So that would usually mean it was in my account then paid towards the new car a couple of weeks later.

Another type of payment is a yearly payment to pay for some complimentary therapy sessions throughout the year. This sort of Grant wouldn’t be fully out of my account for some time.

It is important to be clear about the difference between "income" and "capital". They are two completely different things.

The basic rule is that grants are disregarded as income, but do count as capital.

However, the first point to consider is if the grant is in the nature of income or capital.

Many grants will not be in the nature of income, as they are provided for a specific one-off purpose. As such, they will be capital immediately, and will affect the UC award if it is still in your possession at the end of the Assessment Period in which it is received.

However, other grants will be in the nature of income, as they are "paid regularly and by reference to a period". The grants for the therapy sessions would seem to be of this type.
Despite being "income", they are disregarded from the "income" calculation for UC purposes, as stated above.
The question then becomes: when precisely do they 'convert' from income to capital?
For UC, the general expectation is that income will have converted to capital if it is still held by the end of the AP following the AP in which it was received.
However, I think you could make a strong argument that the above rule should not be followed where the period for which the income is paid is longer than a month.