Universal Credit - Deprevation of Capital

atlantis187

If someone gets over £3K a month in UC payments and takes all this out through the cash machine each month within their assessment period and keeps their balance below 6k then is this classed as deprivation of capital or are they not bothered what u spend the money on long as your balance is below 6K at the start of assessment period.

Spoonie_Turtle

If I'm understanding you correctly you're talking about spending* your income before it becomes capital.  That's not deprivation of capital, that's spending your income.

Deprivation of capital is only when you spend capital you already have, in order to get it down and maximise benefit entitlement.


*I assume you do mean spending, rather than accumulating cash.  If you were accumulating cash that should of course still be declared in the appropriate assessment period when it becomes capital.

atlantis187

Yes i'm talking about withdrawing the UC payments and some work income through the cash machine within an assessment. Reason i'm asking is the cash withdrawals are large amounts like 3/4k a month.
Can they ask what this is being spent on and ask for receipts? 

Muttleythefrog

I think you need to be clearer. Spoonie spells it out. It depends what you're doing with the cash... if you're spending it.. great.. if you're accumulating it month to month and hiding it to gain benefits... fraud.

Capital includes cash.

Muttleythefrog

atlantis187 said:

Yes i'm talking about withdrawing the UC payments and some work income through the cash machine within an assessment. Reason i'm asking is the cash withdrawals are large amounts like 3/4k a month.
Can they ask what this is being spent on and ask for receipts? 

cross posted sorry.... erm... they may ask in a review and it may raise suspicions.. but I'm not sure they'd ask for proof such as receipts and people are entitled to spend their money in the format they like.

Unfortunately there may not be much testimony here available offering up experiences of any bank statement scrutiny with UC and having substantial cash activity. Keeping receipts for that level of cash spending may be quite a burden but may be a protective measure. We were reviewed not that long ago... I actually at the time had been taking out quite a bit of cash because of unusual spending but I was using a no fee credit card so the cash withdrawals never appeared on bank statements... they appeared simply through direct debit repayments to credit card which included regular spending.... so perhaps there is another idea if you want to possibly reduce potential of pointless scrutiny of cash withdrawals. 

atlantis187

I thought we are entitled to spend the UC money however we wish weather using the debit card or using cash. 
Why will it raise suspicion considering we are still under the 6K threshold at end of assessment period. 

Spoonie_Turtle

atlantis187 said:

I thought we are entitled to spend the UC money however we wish weather using the debit card or using cash. 
Why will it raise suspicion considering we are still under the 6K threshold at end of assessment period. 

You are.

I don't know whether realistically they'd question it, that would probably fall under 'who can foretell the whims of the DWP?'.

Although it occurs to me that whether it looks unusual might depend on whether you're drawing it out throughout the month, or in one (or perhaps two) large sums.

If you want sure peace of mind, maybe just keep each assessment period's receipts for a rolling couple of months, that way if they ever did question it you'd easily be able to prove you're spending it rather than withdrawing to stash some away.

The issue of stashing away would be the only thing I can think of that they might want to investigate.  But as to actually spending it all, that's absolutely fine; legally what you spend your income on is irrelevant to your UC.

LightFlare

atlantis187 said:

I thought we are entitled to spend the UC money however we wish weather using the debit card or using cash. 
Why will it raise suspicion considering we are still under the 6K threshold at end of assessment period. 

From a different perspective, I would it is highly unusual for the typical person to withdraw that amount of cash monthly from their bank, especially with a general shift towards a cashless society.

Just the fact that you are doing something so atypical may raise eyebrows/antena.

As already stated though, if you are (and can prove) you are spending as opposed to stashing, then no problem

400ixl

How much of this cash money would not be spent and not stuffed under the mattress at the end of the period is the key question.

Spending the money as cash rather than on a debit card is not an issue as long as it is actually spent and not some of it being kept.

Grumpy_chap

atlantis187 said:

I thought we are entitled to spend the UC money however we wish weather using the debit card or using cash. 

You can spend the money received in any way you choose.

If you are spending the money each month, then that cannot be deprivation of capital as the income is not capital in the period it was received.

Your opening post and title are unclear as to whether you are spending the money generally in the period received, or drawing the cash and keeping it in a jar on the kitchen shelf.  In the latter case, that would become capital and impact the calculation of future UC payments.

Muttleythefrog

atlantis187 said:

I thought we are entitled to spend the UC money however we wish weather using the debit card or using cash. 
Why will it raise suspicion considering we are still under the 6K threshold at end of assessment period. 

As above.. you are... on suspicion possibly.. .remember cash is the currency of crime... solicitors often won't even take more than a couple of hundred pounds from a client of it and banks will often query (possibly when into 4 figures), and restrict how much of it, they take from you.. even the pay in machines restrict (50 notes max in my bank)... their risk is of involvement in money laundering by making dirty money look clean. The lack of traceability of cash is what raises suspicions in general sense if large amounts are moved or held... and that's why criminals choose it... that could include benefit claimants hiding capital.. but that's not the case here... you're spending it if I understand correctly. There are many legitimate reasons people would do as you do... including having a greater control or sense of spending.... even for political or educational reasons...in my wife's case so she could actually become familiar with the coins and notes of the UK.... but at the end of the day you need no reason... just honesty in declaring capital held as and when necessary.  The important fact being that withdrawing cash from bank does not mean it has stopped being capital... it's just capital held in different form until spent.