Universal credit savings calculation

mrdickie

I'm hoping someone can clarify something as I've been asked to tell DWP the amount of money I have in current and savings accounts. They've asked me to tell them what amount me and my partner have in our current accounts on a certain date of the month, each month. Now if I do that after just being paid, that's going to push over the savings threshold and our UC will be decreased. To me that seems unfair as our allowance already takes our income into account and reduces our UC already? 
Also does anyone know the rules about disregarded income as my partner had a backdated payment of pip of over £5k just before we started claiming UC, and they inform me that it's only valid to be disregarded for 12 months. However I read that anything over £5k should be disregarded indefinitely?

huckster

I guess they are saying that the arrears of PIP were paid before you claimed UC and therefore the indefinite disregard does not apply and it would be a 12 month disregard only from the date the arrears were received. The linked document below does appear to confirm this.

Capital_disregards_v11.0.pdf (parliament.uk)

In regard to employed earnings, the guidance states

When income becomes capital H1050 Income becomes capital if it has not been spent by the end of the assessment period after the one in which it was received.

Spoonie_Turtle

huckster said:

In regard to employed earnings, the guidance states

When income becomes capital H1050 Income becomes capital if it has not been spent by the end of the assessment period after the one in which it was received.

So for the OP, the real-world application of that is at the end of your assessment period for UC, total up everything (except the PIP backpay whilst it's disregarded), total up all the income you've received during that assessment period - including earnings and benefit payments - then subtract the income from your overall total.

Although if your total for everything (disregarding the PIP backpay) is below £6,000 then you don't need to do any of the rest of it, as savings below £6k don't affect UC at all.

Edit: also if you've claimed UC as part of a managed migration and you have savings over £16,000 that are disregarded (not including the PIP backpay), you don't need to update UC about the total unless it drops below £16k.

As a further thought, I previously thought benefit arrears of over £5,000 were disregarded indefinitely too but it was explained to me here that that was only if there had been an error in law (I suppose such as when they illegally tried to exclude people from claiming the mobility element for mental illnesses and later had to pay people who did actually qualify?), which mine wasn't.

peteuk

As an example I am using the assessment period of 24 Jul - 23 Aug and the income of £1000 recieved 31 Jul. 

For the assessment period any monies recieved during that period are ignored as capital until the next assesment period.   So your pay on 31 Jul is not counted as capital until 24 Aug - 23 Sep. The same goes for any UC payment you recieve. So therefore if you give them the fiqures on 01 Aug, yes it might have your wage from 31 Jul however its not counted as Capital for that period. 

Your UC will be made aware directly of your income or you will need to advise them on the final day of your assessment period if self employed, this will as you may well be aware will reduce your UC claim by 55p per £1 of wage.  So given the example of £1000 then the UC will be reduced by £550. 

Your bank account will be used to checked capital, as mentioned the PIP backpay is discarged for a year.  If you cuttently have more than £16K on transition from legacy benefits to  UC then this will be disregarded for one year.  You will however still have your UC reduced by £4.35 for each £250 or part of above £6k.