Inheritance and Universal Credit - Pay into pension

Maincarer

Hi All,

Can anyone advise me please?
My cousin is about to receive over £100,000 inheritance following the death of his Gran.  I am one of the Executors of her Will.  He intends to pay off his mortgage which is approx. £40,000.  He has asked if he could pay some of the remainder into his work pension as when he retires it is currently worth £6000.  He is 43.
He lives with his fiancee and two children one of whom has PIP.  He receives Universal Credit.  His job is not well paid.  He has worked ever since he left school at 16 and isn't someone who wants to rely on benefits.
Can anyone advise what he can do please?  Thanking in advance.

HillStreetBlues

Maincarer said:

Hi All,

Can anyone advise me please?
My cousin is about to receive over £100,000 inheritance following the death of his Gran.  I am one of the Executors of her Will.  He intends to pay off his mortgage which is approx. £40,000.  He has asked if he could pay some of the remainder into his work pension as when he retires it is currently worth £6000.  He is 43.
He lives with his fiancee and two children one of whom has PIP.  He receives Universal Credit.  His job is not well paid.  He has worked ever since he left school at 16 and isn't someone who wants to rely on benefits.
Can anyone advise what he can do please?  Thanking in advance.

Pay off mortgage and keep the £60k, this would achieve what's wanted by not having to relying on benefits (UC).

peteuk

If he has worked since aged 16 and is now 43 (27 years) why his is pension pot so low?

I believe you can only put a certain amount into a pension.

HillStreetBlues

peteuk said:

If he has worked since aged 16 and is now 43 (27 years) why his is pension pot so low?

I believe you can only put a certain amount into a pension.

You can put as much into a pension as you like, but there are limits to what tax intensive a person would get.
Trying to badge away a large sum from an inheritance would most likely be deprivation of capital

Grumpy_chap

Maincarer said:

Hi All,

Can anyone advise me please?
My cousin is about to receive over £100,000 inheritance following the death of his Gran.  I am one of the Executors of her Will.  He intends to pay off his mortgage which is approx. £40,000.  He has asked if he could pay some of the remainder into his work pension as when he retires it is currently worth £6000.  He is 43.
He lives with his fiancee and two children one of whom has PIP.  He receives Universal Credit.  His job is not well paid.  He has worked ever since he left school at 16 and isn't someone who wants to rely on benefits.
Can anyone advise what he can do please?  Thanking in advance.

The most that can be paid into a pension and eligible for tax relief is earned income.  

poppy12345

If you're asking can they put money into their pension and then continue with their UC claim then the answer is no. Paying off the mortgage and any other debt is fine. After that if they have more than £16,000 capital their UC will end. 

Keep_pedalling

poppy12345 said:

If you're asking can they put money into their pension and then continue with their UC claim then the answer is no. Paying off the mortgage and any other debt is fine. After that if they have more than £16,000 capital their UC will end. 

And so will their mortgage payments so they are unlikely to be very much worse off if at all.