UC and if you go over 16k?

HillStreetBlues

Spoonie_Turtle said:

Despite my previous understanding and interpretation, I agree that does actually make more logical sense.

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  So unless someone has kept two accounts strictly for savings and income and only spent from the latter, how do you know what's unspent income?  Is there a way of unravelling it that doesn't go all the way back to the start of that person having a consistent income?  That said, I would have more faith in a tribunal panel to get it right (or at least, closer to right) than I would DWP.

[My previous thoughts uninformed by the guidance were that if your bank account never dropped below a certain level, that would be savings because you're obviously not spending it.  But now I know that level itself could include income from a recent payment that you just haven't spent yet, and the same applies every month.  So short of starting from 0 and keeping meticulous records of what's been spent from each income amount, and transferring what's left (if any) from those payments at the end of each following payment cycle for each, I don't see how it could work.  Maybe if I were an accountant I would be able to understand the concept but I'm not!]

It can be a total nightmare to work out correctly
My AP runs from first of month to last day of month.  My AP 1st July -31st July  my UC was paid on the 7th, spending from 1-6th must be from capital as I hadn't had any income spending from the 7th was from my UC income, I got paid PIP on the 17th same day as rent came out  in same account meaning PIP was completely gone, looking at it clearly I had spend that PIP money, so I couldn't argue that is was capital that was spend. But if PIP was paid a day later then that income wouldn't be spent and would roll over and become capital in the next AP.

Another factor is that a claimant might not want to spend their capital and spend their income instead. An example would someone who has a backdated payment of £10k that is disregarded indefinitely  Started their AP with that £10k, Income £2k spending £2k  at the end of their AP they still have £10k. If the £2k is spend from income they still have £10k capital and still all disregarded and no income left at the end of the AP. If they spend from capital at the end of the AP they have £8k capital £2k income. next AP there is only £8k capital disregarded as two of it was spent in the previous AP.

I thought it was pretty simple calculation before, but I looked down the rabbit hole and found out it's not that simple at all.
I expect it would cost the DWP far more in time and as time=money they use a simple formula. (makes m wonder was the Ops first DM was doing).


On the wider issue I think it's disgraceful how the DWP operate with regards to income, capital and  disregarded capital and just talks about monies,
Even on the UC statement it states We take off: ....you have monies, savings and investments   "capital" is never mentioned.

NedS

HillStreetBlues said:

 My guess is income is deducted fully as policy as it's far simpler to calculate. The issue is with that  policy can change, also if it ever goes to a tribunal, they aren't interested in policy, it's the law they have to refer too, and I have found nothing either in Regs or further case law that it's always capital spend before income if in mixed accounts.

I honestly think this is/was an ad hoc decision, and there is no defined policy.

If I had to guess, far more likely that the DM looked at the arguments presented, and H1050, and accepted income is not capital and didn't really give it any more in depth thought than that. They have the evidence and guidance to support the decision, job done, move onto the next one.

NedS

Spoonie_Turtle said:

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  

The starting point would be the start of the first day of the AP. Everything at that point is capital as they are yet to receive any income in the AP, and any (unspent) income received in the last AP has just become capital.

andrewmp

NedS said:

Spoonie_Turtle said:

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  

The starting point would be the start of the first day of the AP. Everything at that point is capital as they are yet to receive any income in the AP, and any (unspent) income received in the last AP has just become capital.

Income doesn't become capital until the end of the AP after it was received though?

HillStreetBlues

andrewmp said:

NedS said:

Spoonie_Turtle said:

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  

The starting point would be the start of the first day of the AP. Everything at that point is capital as they are yet to receive any income in the AP, and any (unspent) income received in the last AP has just become capital.

Income doesn't become capital until the end of the AP after it was received though?

No, it's capital on the 1st day of the the next AP, when reporting capital it's the capital on the last day that's reported, but it's still capital throughout that AP.

Spoonie_Turtle

NedS said:

Spoonie_Turtle said:

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  

The starting point would be the start of the first day of the AP. Everything at that point is capital as they are yet to receive any income in the AP, and any (unspent) income received in the last AP has just become capital.

Ah, that's what I was missing!  Thank you, that makes it nice and simple after all.
Thinking aloud in case it helps anyone else: I was thinking of payment cycles of the different types of income, and the specific wording of H1050:
"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."

BUT using the principle that money is either income or capital*, it's income in the AP received, and in the next is not counted as income so then it must be capital.

*Thank you again for that crucial understanding, NedS.

HillStreetBlues said:

andrewmp said:

NedS said:

Spoonie_Turtle said:

I just can't work out what the starting point would be for working out the baseline of capital, as even at the start of a UC claim for many people the bank account totals will include income from other benefits (and/or previous wages?).  

The starting point would be the start of the first day of the AP. Everything at that point is capital as they are yet to receive any income in the AP, and any (unspent) income received in the last AP has just become capital.

Income doesn't become capital until the end of the AP after it was received though?

No, it's capital on the 1st day of the the next AP, when reporting capital it's the capital on the last day that's reported, but it's still capital throughout that AP.

That perhaps explains why the guidance is worded the way it is even if it's not entirely accurate.

THANK YOU BOTH!!  

That has helped untangle it in my mind (and reconcile the precise wording - which I understand is not law and the law is what counts, but having the guidance make sense anyway means I can put it to rest in my mind).

blackstar

I have just had a thought and would appreciate your thoughts.

Even though the MR was successful it did not address the issues I raised with it, which was what do we now do going forward and alot of what is mentioned above and how did they work it out? 

Maybe it would be a good opportunity while I have it, within 1 month to make an appeal to the tribunal to get this clarified? It would be a shame to loose this opportunity wouldn't it?

What do others think? And how could I put it? As I am not disagreeing with the decision but disagreeing that they didn't address the issues I requested? I am disagreeing with the process? Im disagreeing and appealing that I have to add my income to the money savings and investments?
Im appealing they didn't address my questions on if I have to money keep declaring my income as money savings and investments? 

How could I phrase it? What could I say in a very clear straight forward way as to why I am appealing it or disagreeing with it?

I would also like to ask going forward do I need to declare income received in the same AP and my COL payments when making a money savings and investments  calculation? 
Or do I continually each month need to go though the same weeks long procees and them putting my UC on hold for an unknown amount of time?
I dont want then to say why are you appealing this when you dont disagree with the decision? 

Also out of interest when it states declare your "money, savings and investments" does this include income received in the same AP? Does the income received in the same AP classed as 'money'? 
Just thought the system actually at the end of a money savings and investments declaration says this is your capital....so obviously it does include your income as capital but theres no box to type in your income? 
But theres a box to put in welfare support payments and the system automatically removes it at the end of the declaration so why not income?
Also the system then double removes money from earned income as deducts your earned income from your UC and also ontop of that removes £4.35 from every £250 of your earned income and ontop of that it is considering that income as capital???

Also if I make this appeal to the tribunal will it put my UC on hold until it is heard?

huckster

As far as I understand it, you cannot go to tribunal as MR based on what you put forward was upheld in your favour.

What you need to ask for is a written statement of reason explaining the rationale of the decision, so you understand how capital needs to be calculated and reported in future UC assessment periods.

blackstar

huckster said:

As far as I understand it, you cannot go to tribunal as MR based on what you put forward was upheld in your favour.

What you need to ask for is a written statement of reason explaining the rationale of the decision, so you understand how capital needs to be calculated and reported in future UC assessment periods.

So no way to make a tribunal case then?

Who would I ask for a written statement of reason explaining the rationale of the decision so I know how to report capital in future? 
I know they will just ignore that probably 

huckster

Don't think so. What would you be asking Judge to consider? It would only be if you had valid legal arguments regarding personal detrimental affects outstanding.

And as MR was in your favour, nothing appears outstanding for tribunal to consider

Ask for written statement of reason as first step.