Universal Credit and Lifetime ISA

funkygal

Hi all, I made a new (and first) claim for UC and still waiting for first payment. 

I have a Lifetime ISA but just realised I declared the full value instead of 75% due to the 25% penalty.

I can't find any official information online that says I only need to declare 75% but I'm sure I've read it somewhere! Can someone please confirm this? Thank you.

kimwp

You can only have 75% of it if you withdraw the money before you are 60, so it would make sense that you only declare 75% of it if under 60.

NedS

You should declare the full amount. When you take evidence of your capital to your appointment to verify your capital, you can mention it and DWP can apply the disregard. If you've declared the full amount and DWP have not applied a 25% disregard and are making deductions for capital from your UC payments, you should contact them.

Obviously, it's only relevant if you have capital over £6,000, otherwise don't worry.

born_again

You would have to declare the value as it shows now. You can't deduct 25% until you actually withdraw the funds.

funkygal

NedS said:

You should declare the full amount. When you take evidence of your capital to your appointment to verify your capital, you can mention it and DWP can apply the disregard. If you've declared the full amount and DWP have not applied a 25% disregard and are making deductions for capital from your UC payments, you should contact them.

Obviously, it's only relevant if you have capital over £6,000, otherwise don't worry.

Hiya, I've declared the full amount. How would I know they have disregarded the 25%? I've not been given an appointment though, I called and they said they verified my ID and children online so no appointment needed? My savings are over 6k. I don't think there was a section when filling in the claim for Lifetime ISAs in particular, just normal ISAs so that's why I feel like I should have declared 75% only. 

Spoonie_Turtle

funkygal said:

NedS said:

You should declare the full amount. When you take evidence of your capital to your appointment to verify your capital, you can mention it and DWP can apply the disregard. If you've declared the full amount and DWP have not applied a 25% disregard and are making deductions for capital from your UC payments, you should contact them.

Obviously, it's only relevant if you have capital over £6,000, otherwise don't worry.

Hiya, I've declared the full amount. How would I know they have disregarded the 25%? I've not been given an appointment though, I called and they said they verified my ID and children online so no appointment needed? My savings are over 6k. 

On your UC statement it will tell you how much they're deducting for savings over £6,000 - it's £4.35 for every £250 or part thereof over 6k.  It will also say 'you told us you have £xxxx'.  So you'll be able to see and double check the amount they're basing deductions on.

funkygal

Spoonie_Turtle said:

funkygal said:

NedS said:

You should declare the full amount. When you take evidence of your capital to your appointment to verify your capital, you can mention it and DWP can apply the disregard. If you've declared the full amount and DWP have not applied a 25% disregard and are making deductions for capital from your UC payments, you should contact them.

Obviously, it's only relevant if you have capital over £6,000, otherwise don't worry.

Hiya, I've declared the full amount. How would I know they have disregarded the 25%? I've not been given an appointment though, I called and they said they verified my ID and children online so no appointment needed? My savings are over 6k. 

On your UC statement it will tell you how much they're deducting for savings over £6,000 - it's £4.35 for every £250 or part thereof over 6k.  It will also say 'you told us you have £xxxx'.  So you'll be able to see and double check the amount they're basing deductions on.

Thank you, I haven't received the statement yet, as it's my first claim. I'm sure they would not had disregarded it yet as I don't remember specifically putting down that it was a LISA. I will be able to check in less than two weeks.

If they have not disregarded it, do I just report the change/tell them it's an LISA and then it will be updated next month and would I get that little bit of extra money for the previous month it would it be only going forward?

Spoonie_Turtle

You might be able to see if you go to 'report a change' → 'money, savings and investments'.

In fact if your bank account totals have gone down by the end of your assessment period (compared to the total when you made your claim) it might be a good idea to report it as a change anyway, as capital is based on the last day of your assessment period.

[Without wanting to throw a spanner in the works, unless you've not received any income at all in the month then your total at the end of the month is unlikely to all be capital, some of it will be income and should not count towards the amount for which they take a deduction, but the system doesn't give any way of making that distinction and it's all a bit of a mess on that front.]

funkygal

Spoonie_Turtle said:

You might be able to see if you go to 'report a change' → 'money, savings and investments'.

In fact if your bank account totals have gone down by the end of your assessment period (compared to the total when you made your claim) it might be a good idea to report it as a change anyway, as capital is based on the last day of your assessment period.

[Without wanting to throw a spanner in the works, unless you've not received any income at all in the month then your total at the end of the month is unlikely to all be capital, some of it will be income and should not count towards the amount for which they take a deduction, but the system doesn't give any way of making that distinction and it's all a bit of a mess on that front.]

I just checked and can see it included the full declared value. I don't recall an option to let you you state that it was for an LISA and not a normal ISA. I can't find any information on whether to declare full amount or 75%.