Effect on benefits of Renters Reform Bill

Rupertdoggie

Like many others, I have been required to pay 6 months rent in advance for my private rental flat. I have done this - and claimed housing benefit, which I have put in a separate bank account towards the next 6 months rent. This was disregarded in terms of capital.

 

When the Renters Reform Bill becomes law, I will no longer be required to pay my rent 6 months in advance, and, with a periodic tenancy, will move to paying monthly. At that time, I will have a sum of approximately £7000 in the bank (previously used to pay my rent in advance). In addition, I have just below £6000 in another bank account.

My query for housing benefit, and ESA (IR) , is how exactly will this sum be treated? I have not yet been migrated to Universal Credit. 

 

FlorayG

Do you mean how will they regard the money in the bank as savings? Surely no different to how they would now?

poppy12345

Rupertdoggie said:

Like many others, I have been required to pay 6 months rent in advance for my private rental flat. I have done this - and claimed housing benefit, which I have put in a separate bank account towards the next 6 months rent. This was disregarded in terms of capital.

 

When the Renters Reform Bill becomes law, I will no longer be required to pay my rent 6 months in advance, and, with a periodic tenancy, will move to paying monthly. At that time, I will have a sum of approximately £7000 in the bank (previously used to pay my rent in advance). In addition, I have just below £6000 in another bank account.

My query for housing benefit, and ESA (IR) , is how exactly will this sum be treated? I have not yet been migrated to Universal Credit. 

 

Who told you it’s disregarded as capital? Who ever it was is not correct, there’s no disregard for this. 

Rupertdoggie

The housing benefit money put towards rent in advance was disregarded by my local council. 

Rupertdoggie

FlorayG said:

Do you mean how will they regard the money in the bank as savings? Surely no different to how they would now?

Previously, the money from housing benefit for future rent was disregarded. Still waiting to find out if, when the Renters Reform Bill is passed, this money will be treated as savings. Or will be disregarded in new regulations. 

NedS

Most people should be moved from Housing Benefit onto Universal Credit by the end of the year. There are no regulations to disregard such savings/capital under Universal Credit, so when you are moved onto UC, anything left once you have paid your rent and other bills for the month will be taken into account in the normal way.

As @poppy12345 says, I'm surprised HB advised you it could be disregarded.

Rupertdoggie

Yes, it appears clear under Universal Credit rules. However, if I haven't received my migration letter by 2 August, I won't need to migrate as I reach retirement age on 2 February 2026.

Spoonie_Turtle

Rupertdoggie said:

Yes, it appears clear under Universal Credit rules. However, if I haven't received my migration letter by 2 August, I won't need to migrate as I reach retirement age on 2 February 2026.

Unless they've changed it recently, migration letters give 3 months' notice, not 6.

HillStreetBlues

Rupertdoggie said:

The housing benefit money put towards rent in advance was disregarded by my local council. 

But what about the DWP? as you are getting IR ESA.

HillStreetBlues

NedS said:

Most people should be moved from Housing Benefit onto Universal Credit by the end of the year. There are no regulations to disregard such savings/capital under Universal Credit, so when you are moved onto UC, anything left once you have paid your rent and other bills for the month will be taken into account in the normal way.

As @poppy12345 says, I'm surprised HB advised you it could be disregarded.

The issue is it's not up to the council, it's a DWP decision.
As OP is on IR ESA  any capital  deduction should come off the ESA

Rupertdoggie

Just to clarify a few points. 
Both my local council and the DWP have previously treated money in my bank account, put away to pay another 6 months rent in advance, as disregarded capital. That has been the case for some 20 years. 
When I am no longer required to pay 6 months rent in advance, it seems under Universal Credit rules it would be classed as savings.
I have put 2 August as the last date I could receive a migration letter from ESA to UC, as a letter cannot be sent out less than 6 months before retirement age.