Benefits and Inheritance

DE_612183

Hi - if someone is due an inheritance, but they are in receipt of UC - is there anyway that the inheritance can be drip fed through ( perhaps from a trust ) to avoid losing the UC payments?

Flugelhorn

why would they need to do this? I would have thought that if they had an inheritance then they wouldn't need the UC any longer?

TELLIT01

Only if the trust was described in the will.  It can't be set up after the event in order to protect the inheritance.  Income Related (Means Tested) benefits are there to help people who don't have the capital to support themselves.

Seasalt3

Why would you think you should carry on and be entitled to receive  benefits if you have received an inheritance??

DE_612183

not me - I was asked the question as I am executor - I sort of knew the answer ( but wanted to check ).

kaMelo

What is written in the will matters. If the will dictates money should be placed into a trust then that is what needs to happen but if not then it can't be done afterwards.

Dripfeeding the inheritance for no other reason than to avoid someone losing or reducing their benefit qualifucation is by definition, deliberate deprivation of capital. 

To put it another way, if the benificiary were not claiming means tested benefits would you be considering any option other than distributing their share in a timely fashion?

HillStreetBlues

kaMelo said:

What is written in the will matters. If the will dictates money should be placed into a trust then that is what needs to happen but if not then it can't be done afterwards.

Dripfeeding the inheritance for no other reason than to avoid someone losing or reducing their benefit qualifucation is by definition, deliberate deprivation of capital. 

To put it another way, if the benificiary were not claiming means tested benefits would you be considering any option other than distributing their share in a timely fashion?

I disagree with that.
It's not DoC as it's the person's money,  drip fed or not.
What it would be is fraud, as it would be undeclared capital (basing it on over £6k), this would apply to the claimant & executor.

Newly_retired

The only good reasons I can see to dripfeed an inheritance are
1) to pay an interim payment of the inheritance if the estate is not quite finalised
2) the amount is small, and whilst it would take the person off benefits they would soon use up the inheritance on daily living costs and have to claim benefits again within a short time scale.

kaMelo

HillStreetBlues said:

kaMelo said:

What is written in the will matters. If the will dictates money should be placed into a trust then that is what needs to happen but if not then it can't be done afterwards.

Dripfeeding the inheritance for no other reason than to avoid someone losing or reducing their benefit qualifucation is by definition, deliberate deprivation of capital. 

To put it another way, if the benificiary were not claiming means tested benefits would you be considering any option other than distributing their share in a timely fashion?

I disagree with that.
It's not DoC as it's the person's money,  drip fed or not.
What it would be is fraud, as it would be undeclared capital (basing it on over £6k), this would apply to the claimant & executor.

Touché

Upon reflection, whilst I'm sure you knew what I meant, you are of course correct in that whether capital was received or not is irrelevant, if it's available and undeclared it's fraud.

TELLIT01

Newly_retired said:

The only good reasons I can see to dripfeed an inheritance are
1) to pay an interim payment of the inheritance if the estate is not quite finalised
2) the amount is small, and whilst it would take the person off benefits they would soon use up the inheritance on daily living costs and have to claim benefits again within a short time scale.

2 above would still be making a fraudulent claim if the amount of available inheritance is over £6k because level of entitlement would be affected.  If over £16k there would no entitlement and trying to justify doing so on the basis of it being easier than making a new claim doesn't change that fact.

DE_612183

What would happen if the person receiving the payment, t hen paid it all into a pension?