Universal credit i have really messed up and misunderstood capital

sheramber

Grumpy_chap said:

sheramber said:

Tiu can only claim for the interest paid and that is given as a tax credit against your tax due. 

Even this has changed - no longer possible to claim the full interest paid against tax relief.
I am sure the OP will be fully aware of the rules and tax declarations for having the BTL.
It is only the UC they claim to have misunderstood.

What makes you sure?
She does not mention tax as an expense against the letting income .
 

Since when has there been a restriction on the amount of interest relief you  can claim at 20%?

Grumpy_chap

sheramber said:

What makes you sure?
She does not mention tax as an expense against the letting income .

I can't be sure.
I was giving the OP the benefit of the doubt that they made one mistake by mis-understanding the capital associated with the BTL being declared for UC purposes, but not that they had also failed to properly report the income from a tax perspective.  If the income tax has been incorrectly reported as well as the misunderstanding with regard to UC, it does become rather a bigger mess to unpick.

Northern_Wanderer said:

"Claim" being the relevent word. The questions are very easy, like "What sort of money, savings and investments do you have? and checkboxes to tick, please see the Step by Step guide to making a UC claim video at 4.04 minutes https://www.youtube.com/watch?v=_qzBUZt99iE I fail to see how the majority of people could misunderstand. 

Yes, that tick box you have referenced "property you own (but not the property you live in)" under the question "what types of money, savings and investments do you have?" does seem to be straightforward. 
The OP, however, claims to have misunderstood. 
Perhaps the OP could explain how they understood that part of the form and where else they had categorised the BTL in their declarations.

CosmoChic

I'm calling it!

The OP ain't coming back. 

Collectively we've given them what they wanted: an indication of how gullible (or not) DWP Officers will be in hearing their explanations.

Yamor

It's such a pity that people respond to threads in this manner, and it really reduces the value of the forum.
Posters here are not DWP, nor the police or judge and jury, and there is no need to pass judgement on other people's actions and motives. Particularly when they have little of value to add, or simply have no clue how the benefit system works, or how such things are dealt with in practice.

To the OP:

Of course you realise now that £6k is also an important threshold, and exceeding it would lead to an overpayment. However, the chances of prosecution in this situation (capital over £6k, but under £16k) are virtually nil. Any overpayment would simply be recovered slowly from your ongoing award. You may also be given a £50 civil penalty (although in my experience, they don't give these as often for UC compared to other benefits).

As regards the figures you've given, there are a few points worth noting:

1. It is the current market value of the property at any time which is relevant, and not just the value as at the date of your claim, so if the property value has increased since your original UC claim, then that could make the position worse.

2. You can deduct 10% of the market value of the property for costs of selling. For example, if the property is worth £70k, and has a mortgage of £61k, then the value taken into account for UC purposes is not £9k, but £2k (as you can deduct 10% of the £70k, which is £7k).

3. When calculating money in the bank, DWP will generally allow you to deduct any income received from earnings or benefits in that Assessment Period. So, if you had £7k in the bank at the end of an Assessment Period, but received, say, £3k in earnings and benefits during that AP, then they would only count £4k of that money as capital.

Northern_Wanderer

Yamor said:

It's such a pity that people respond to threads in this manner, and it really reduces the value of the forum.
Posters here are not DWP, nor the police or judge and jury, and there is no need to pass judgement on other people's actions and motives. Particularly when they have little of value to add, or simply have no clue how the benefit system works, or how such things are dealt with in practice.

To the OP:

Of course you realise now that £6k is also an important threshold, and exceeding it would lead to an overpayment. However, the chances of prosecution in this situation (capital over £6k, but under £16k) are virtually nil. Any overpayment would simply be recovered slowly from your ongoing award. You may also be given a £50 civil penalty (although in my experience, they don't give these as often for UC compared to other benefits).

As regards the figures you've given, there are a few points worth noting:

1. It is the current market value of the property at any time which is relevant, and not just the value as at the date of your claim, so if the property value has increased since your original UC claim, then that could make the position worse.

2. You can deduct 10% of the market value of the property for costs of selling. For example, if the property is worth £70k, and has a mortgage of £61k, then the value taken into account for UC purposes is not £9k, but £2k (as you can deduct 10% of the £70k, which is £7k).

3. When calculating money in the bank, DWP will generally allow you to deduct any income received from earnings or benefits in that Assessment Period. So, if you had £7k in the bank at the end of an Assessment Period, but received, say, £3k in earnings and benefits during that AP, then they would only count £4k of that money as capital.

I think the people who responded gave the OP thier rights and prepared them for the reality of what might happen given the fraudulent claim. Stating this is a fraudulent claim is not an opinion, it is a fact because the OP failed to declare thier capital when they made a claim for UC. Hopefully people reading these types of thread think twice about committing benefit fraud and realise that the DWP are catching up on people.