SDP Backpay & Housing Benefit random review

Jazeebo

Hi there,

I'm after some general advice, as I'm stressing out and not sure if I've inadvertently broken any rules. 

Back in February of this year, I was awarded a £15k payout in backpay for Severe Disability Premium which went straight into my account. This was money owed for the previous 5 years. DWP at the time also said that my ESA would be increasing due to the SDP component being awarded. I also get basic rate PIP for mental health every month. I am also in receipt of Housing Benefit. I live in a council flat.

Today I received a letter from my local council asking for a random review. They are asking for 2 months bank statements. I left the money in an ISA, and I already had 5k in savings as well. It matured in the summer and I have been transferring money from the ISA into my main account and spending it as cash and online as well. I did ask for advice on how the amount is discounted and received conflicting information. Some said it was discounted for 1 year from the time of the payment and some others said because it is over £5K it is discounted for the length of my claim.

I am due to move over to Universal Credit in December also from ESA/PIP, so hence why I have been drawing out and spending a large chunk of it on things that could well help me acquire new skills and possibly get me back to work in the new year. I also intend to pass my driving test and get a small car next year too if I can.

What I would like to know is, when I received the back payment from DWP for SDP should I have notified Housing Benefit? I didn't think it was necessary at the time, because I know they liaise with each other and can find out anyway. 

Will I get into trouble with Housing Benefit because of this when I complete my review, and are they likely to ask me to pay back any housing benefit from the time the SDP was awarded? That could be thousands.  

I got the letter this morning and I'm currently scrambling looking for paperwork. I have found the letters from DWP stating the award of the £15k, so I guess that's a good start. I currently have £5000 in savings locked in an ISA until next year, but taking away the amount from the backpay I do not go over £6K which I was told I am allowed to have before deductions need to be made.

Am I in the 5h1t for not notifying Housing Benefit of this back in February? I didn't think I needed to tell them if it was money that was not counted/discounted, etc.

Last year I had false allegations made to DWP I was working and claiming, but there was NFA in the end as I could explain things and it was all BS with no proof, but it really stressed me out and made me quite ill. I've done so well with my mental health since the summer of last year and I don't want to suffer another setback. Am I overthinking this or am I right to feel concerned?

Any help and advice would be very much appreciated.

HillStreetBlues

No you're not in trouble.
As you are getting SDP part if not all of your ESA will be income based. The DWP manages that benefit and it passports you to the maximum Housing Benefit.

Normally the LA doesn't bother with looking at capital for those on IB ESA as that's the DWP's job. All you need to do is tell the LA about all your capital and that £15k comes from an underpayment and the DWP is fully aware of it and is current disregarded (it's disregarded for 12  months, or the length of the benefit claim if there was an error in law. )