When do gambling winnings become capital for UC?

HillStreetBlues

Yamor said:

The rule in social security, supported by a lot of case law, is that all of a person's resources are either income or capital. There is nothing in between, and the same resource cannot be both income and capital at the same time.

Therefore, something which is income in the first instance will not be capital until some later stage when it changes from income to capital. Current UC guidance states that this happens in the following AP. However, something which is not income in the first instance will be capital immediately.

Of course, if the gambling is carried out professionally, in an organised manner, and with a view to making a profit, then it may well be treated as self-employed earnings, and then will be income in the first instance.

As the OP has their answer I thought I would pose a question.
with the CoL payments (Social Security (Additional Payments) Act 2022 & 2023 it states

Payments to be disregarded for the purposes of tax and social security

No account is to be taken of an additional payment in considering a person’s—

(a)liability to tax,

(b)entitlement to benefit under an enactment relating to social security (irrespective of the name or nature of the benefit), or

(c)entitlement to a tax credit.

If the money isn't taken into account then it can it be either income or capital as both of these the money is taken into account and disregarded if appropriate?
Does these Acts mean that the money doesn't exist for the calculation for benefits & tax?

LateStageCrapitalism

Northern_Wanderer said:

Any money that you have in any bank account or indeed the gambling account is capital. It doesn't matter the intention or if you win big.

What is the real issue here? Why did you need to ask such questions?

I gamble; sometimes I win. When I win, I want to make sure I stay within UC capital rules. In order to do this, I need to know exactly what they are. My question was about exactly when winnings become capital. If they became capital in the AP after they were won, then I wouldn't need to declare any of the money in my gambling account as its constantly being churned over into new winnings/losses, and I would only have to declare any funds I returned to my bank account. However, as this is clearly not the case I will need to declare the money in my gambling account, which will affect my benefit entitlement. I was simply trying to gain a full understanding of the situation, particulalry as DWP staff often don't know/apply the rules correctly.

Newcad

Accounts such as bookmaker accounts, or PayPal or Amazon, or ...... are stll your accounts with your capital in them.

If you are claiming benefits then you should declare to the DWP  any balance in such accounts.

TELLIT01

Isn't the calculation of income and/or capital made at the end of each assessment period?  If that is the case, it won't matter whether it is income or capital as both would be treated in the normal way.

Northern_Wanderer

LateStageCrapitalism said:

Northern_Wanderer said:

Any money that you have in any bank account or indeed the gambling account is capital. It doesn't matter the intention or if you win big.

What is the real issue here? Why did you need to ask such questions?

I gamble; sometimes I win. When I win, I want to make sure I stay within UC capital rules. In order to do this, I need to know exactly what they are. My question was about exactly when winnings become capital. If they became capital in the AP after they were won, then I wouldn't need to declare any of the money in my gambling account as its constantly being churned over into new winnings/losses, and I would only have to declare any funds I returned to my bank account. However, as this is clearly not the case I will need to declare the money in my gambling account, which will affect my benefit entitlement. I was simply trying to gain a full understanding of the situation, particulalry as DWP staff often don't know/apply the rules correctly.

Ok, I understand, and now you know your winnings need to be declared regardless of their location. I think you will find that a Decision Maker will know the rules even if general UC/ DWP staff do not. 

Northern_Wanderer

Newcad said:

Accounts such as bookmaker accounts, or PayPal or Amazon, or ...... are stll your accounts with your capital in them.

If you are claiming benefits then you should declare to the DWP  any balance in such accounts.

Yes, but usually people convince themselves that money hidden in places UC does not know about are not included in their capital.

NedS

LateStageCrapitalism said:

Northern_Wanderer said:

Any money that you have in any bank account or indeed the gambling account is capital. It doesn't matter the intention or if you win big.

What is the real issue here? Why did you need to ask such questions?

I gamble; sometimes I win. When I win, I want to make sure I stay within UC capital rules. In order to do this, I need to know exactly what they are. My question was about exactly when winnings become capital. If they became capital in the AP after they were won, then I wouldn't need to declare any of the money in my gambling account as its constantly being churned over into new winnings/losses, and I would only have to declare any funds I returned to my bank account. However, as this is clearly not the case I will need to declare the money in my gambling account, which will affect my benefit entitlement. I was simply trying to gain a full understanding of the situation, particulalry as DWP staff often don't know/apply the rules correctly.

As previously stated, winnings from gambling are treated as capital immediately.

For UC purposes, the only thing that matters is your capital balance on the last day of the Assessment Period (AP). You could start the AP with capital of £5000, then during the AP you could have a very large win taking you over the £6000 or £16000 thresholds, and then later in the AP you could have a very large loss and go back under those thresholds. All that really matters is the amount of capital you hold on the last day of the AP, and any winnings from gambling during the AP will count towards that.

NedS

Northern_Wanderer said:

Newcad said:

Accounts such as bookmaker accounts, or PayPal or Amazon, or ...... are stll your accounts with your capital in them.

If you are claiming benefits then you should declare to the DWP  any balance in such accounts.

Yes, but usually people convince themselves that money hidden in places UC does not know about are not included in their capital.

This is where the new digital legislation will help, as all of these types of account will be required to share data with DWP and will raise AI red flags (for Targeted Case Reviews) for claimants with more than £6,000 in undeclared capital.

I wonder how they will treat my electricity account being £600 in credit due to solar export built up over the summer to pay for my electricity in winter.

HillStreetBlues

NedS said:

This is where the new digital legislation will help, as all of these types of account will be required to share data with DWP and will raise AI red flags (for Targeted Case Reviews) for claimants with more than £6,000 in undeclared capital.

I wonder how they will treat my electricity account being £600 in credit due to solar export built up over the summer to pay for my electricity in winter.

They will be able to share if they know the OP is on UC (or PC/ESA).

TimeLord1

Credit would be classed the same as a card. But there's nothing to stop people from paying off large amounts in advance payments for anything they're currently billed for including local Taxation.