UC and disregarded money

Wobbly_World

Hello

I  am moving from ESA to UC and have a question about disregarded money.

When DWP ask for details of bank accounts, do I also have to give details of these two bank accounts where the money is disregarded for benefit purposes. 

1. Personal injury trust fund, set up by solicitor, I cannot access without trustee signature. I do not know the bank details but could request them from trustee.  

2. Bank account for direct payments from local authority to pay for care?  This is a separate bank account in my name with the words direct payments and contains over £6000 as I have a large care package. I can access the money but it is social services money and if I do not spent on care then I have to pay the money back to local authority. 

Thanks in advance
 

huckster

Yes you need to provide details of these accounts and ask for disregards to be applied. This ensures it is all fully noted on UC claim for future reference.

HillStreetBlues

If the money is disregarded by law  then you don't have to inform them, as there is no affect on your benefits. You might want to as could save hassle further down the line,  But in saying that it's also possible they will suspend your UC straight away while someone passes it to a DM (who will have no choice than to disregard money in a PI trust it if they know the law).
You would need to inform them is the disregard is discretionary, but any money  PI in trust isn't.
If you are unsure then best to declare.

Sea_Shell

Does Injury compensation HAVE to be in a trust to be disregarded?

What if someone just had a cash payment?

Muttleythefrog

Sea_Shell said:

Does Injury compensation HAVE to be in a trust to be disregarded?

What if someone just had a cash payment?

1. Yes (except for first 12 months)

2. After 12 months it'll be considered capital.

Those 12 months give chance to move to trust (offered by ever dwindling banks I believe)

My understanding.. which I'm sure someone will correct if wrong.

Sea_Shell

Are the capital disregard rules different for other means tested benefits?

NedS

Sea_Shell said:

Are the capital disregard rules different for other means tested benefits?

Not sure, but I'm not aware of any differences between benefits. The disregard regs that exist on UC were generally carried forward from existing legacy benefit rules.

The intent is that if the injury, and hence compensation, is minor then the compensation would most like have been spent within a year.

However, if the injury were lifelong and the compensation substantial and expected to last a lifetime, then the disregard would need to reflect that and hence the money would have to be held in trust to be disregarded for any more than the standard 12 month period.

Sea_Shell

Hmm, I'm sure I'd read that for, say, pension credit, it didn't mention trusts, just disregard, in respect of capital from PIC

HillStreetBlues

NedS said:

Sea_Shell said:

Are the capital disregard rules different for other means tested benefits?

Not sure, but I'm not aware of any differences between benefits. The disregard regs that exist on UC were generally carried forward from existing legacy benefit rules.

The intent is that if the injury, and hence compensation, is minor then the compensation would most like have been spent within a year.

However, if the injury were lifelong and the compensation substantial and expected to last a lifetime, then the disregard would need to reflect that and hence the money would have to be held in trust to be disregarded for any more than the standard 12 month period.

I agree with UC carrying over from  legacy benefits.

There is a difference with SPC  it's disregarded  indefinitely without the need for a trust
The State Pension Credit Regulations 2002, Schedule 5, 16, 1

16 (1)] An amount equal to the amount of any payment made in consequence of any personal injury to the claimant or, if the claimant has a partner, to the partner.

HillStreetBlues

Sea_Shell said:

Hmm, I'm sure I'd read that for, say, pension credit, it didn't mention trusts, just disregard, in respect of capital from PIC

You're correct, but I believe @NedS  was just talking about benefits under pension age.

Wobbly_World

Thanks everyone. DWP would already be aware but I'm not sure how much ESA would share with UC so probably best I ensure they do know. 

I'm not sure what the rules are for pension credits but I know for ESA and UC the compensation is only disregarded for 12 months unless it is in a trust fund. In my case, the solicitor who handled my claim gave me information about trust funds and referred me to a separate department who dealt with trust funds. Years later I had another much smaller injury claim handled by a different solicitor and they had little knowledge of trust funds. The solicitors informed DWP of the compensation awarded and I received a letter from DWP compensation recovery unit confirming no recovery of benefits.