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Notional Charge on Assets
jlfrs01
Posts: 291
Forumite
Hello All,
I am a Paying Parent who recently opted out of a Consent Order to open a case with the CMS. I have a question about the guidelines or rules about how the CMS assesses a notional charge on assets because I find it pretty confusing. My understanding is that any asset which appears with HMRC such as rental income and interest on savings which is over the £2500 threshold is classed as notional or unearned income and the CMS will take 8% of the value and add it to the PP's income figure. What I am unsure about is how the value of that asset is treated if it's value is greater than £31,250? For example, let's say I have sold my house and banked the £300,000 equity which will sit there for a couple of months before my house purchase goes through. How would the CMS treat that cash? It won't earn any interest and it won't be there long but does it still count?
I am a Paying Parent who recently opted out of a Consent Order to open a case with the CMS. I have a question about the guidelines or rules about how the CMS assesses a notional charge on assets because I find it pretty confusing. My understanding is that any asset which appears with HMRC such as rental income and interest on savings which is over the £2500 threshold is classed as notional or unearned income and the CMS will take 8% of the value and add it to the PP's income figure. What I am unsure about is how the value of that asset is treated if it's value is greater than £31,250? For example, let's say I have sold my house and banked the £300,000 equity which will sit there for a couple of months before my house purchase goes through. How would the CMS treat that cash? It won't earn any interest and it won't be there long but does it still count?
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