Universal Credit - Deprivation of Capital.

saffron79

I am shortly to receive a lump sum from NHS Continuing Health Care which is a repayment of care fees paid by my now deceased mother between 2019 and 2021. It has taken 3.5 years since her death (2022) to get CHC to admit my mother was entitled to nursing funding during the time and should not have had to self fund her care.

Given I am the only remaining benefactor, these monies have now been paid to me. I am on Universal credit and am unlikely to return to paid employment due to illness. I will reach pensionable age next year. If I report this payment, as I believe I am required to by law, is it likely that the DWP will treat this as capital?

It will take me over the threshold for entitlement for UC. It seems incredibly unfair that I will lose my entitlement and be forced to use this lump sum to live on. I have no home of my own or other assets.

My current savings are tiny and well below the threshold. Is there any possibility the CHC lump sum can be disregarded by DWP? If not, can I legitimately put it into a pension fund (I do not have one at present) or a charitable trust fund in my late mother's memory?

HillStreetBlues

The money is part of an inheritance so not disregarded. Unless yo have a history of giving money away doing it now would be looked at a DoC.
How much money (capital) will you have once paid?

peteuk

The only way a trust fund is disregarded in such circumstances, is if it stipulates in the will that it’s to be set up as a trust fund. A benefactor can not receive the money and then set up a trust fund.

kaMelo

As alluded to by @HillStreetBlues, the reasons for your mother becoming entitled to this money is not a relevant factor in your situation. For you it is simply an inheritance for which no disregard applies, for UC purposes it is capital on the day you receive it.

If the will stipulated setting up a trust that should be okay, if it didn't then essentially you've just given money away and UC will probably deem you still have the capital.

Regarding a pension, it's more of a grey area. Deprivation of capital is when you do something with the deliberate intention of maintaining or increasing benefit entitlement, which is exactly what you're trying to do. However it is likely that putting an amount equal to you're earned income into a pension fund would not be questioned. If you have no earned income then £2880 can be deposited and you would receive a tax rebate of £720 into the pension. Any more than that would not receive a tax rebate and would possibly be deemed deprivation.

Why do you think it's unfair? Means tested benefits are exactly that, available to those without the means to support themselves. This inheritance gives you the means to do so.

Brie

Do you have debts that need to be paid? Things around the home that need to be fixed? Maybe that would make a difference to what savings remain?

TELLIT01

Presumably, if the money hadn't been paid for CHC in the first place, that money would simply have come to you at an earlier date. That being the case, entitlement to UC would have ceased at that point. In reality, you are in no worse situation than if that had happened.

As others have said, you can clear debts, replace defective or worn out household items etc.

Grumpy_chap

https://forums.moneysavingexpert.com/discussion/comment/81959557#Comment_81959557

Arguably, the OP is in a better position receiving this money now than had they received the money 3 years or so back as that is three years where the OP has received UC that they might not otherwise have been eligible for. The OP is now only ceasing their UC claim for one year before they reach pension age and UC would cease in any case.

saffron79

https://forums.moneysavingexpert.com/discussion/comment/81959059#Comment_81959059

Thanks. The reason that I believe this unfair? In my specific case, because my mother should have benefitted from the nursing care when she needed it and had the repayment been agreed and processed while she was alive, I wouldn't have had to give up my job, livelihood, home, and life and to care for her.

We could have used the funds to source care for her at home. I cared for her because despite paying into the system all her life, and despite having primary and complex health needs, the NHS denied my mother access to the care she needed while she was alive.

I put in 90 and 120 intense care hours over 7 days per week, had 2 half days off in the final 14 months, and saved the state £56K in domiciliary care fees over the period I was caring for her. I also spent my entire savings to keep a roof over her head because the LA failed to meet its duty of care to house her. Now that after 5 years, CHC finally admit she was entitled to free nursing care all along, I will be forced to use the repaid fees just to keep a roof over my head. That's why I feel it is unfair.

huckster

You cannot change the fact that Universal Credit is affected by receipt of the money and there is nothing that would allow a Decision Maker to deduct the amount from capital taken into account.

However, there are other avenues open to you to pursue compensation and your local MP may be able to help. I.e. Parliamentary Ombudsman.

We are the Parliamentary and Health Service Ombudsman | Parliamentary and Health Service Ombudsman (PHSO) https://share.google/lDxphSaMAQ22JSh5Z