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DWP Tribunal - Compliance help required Please
jslutani
Posts: 2 Newbie
In 2015 my brother and I decided to help my father by purchasing his council property, in doing so both my parents, my brother and I had become the registered owners of this property. As my father suffers from disability this seemed like the best option to be able to support him financially and be able to be by his side whilst residing in the property. Considering my fathers condition we always knew we would need to support him in the future. We covered his mortgage and tried to help with his condition.
As the property had a garden to the side that was vacant, my brother and I spoke to our local council to see whether they would accept the land being split in order for us to build a property next door. This would allow us to be close to him in the foreseeable future.
The council agreed to the land split on the condition that the current titleholders on the current land are to be included on the new land. This was approved and the land was split towards the end of 2016. In 2017 we managed to get contractors to build us a property in which both my brother and I currently reside in, with my parents living next door as our neighbours in the original property.
Recently my father had been contacted by DWP and informed that his benefits have been terminated due to compliance, due to the fact that he know legally owns two properties. They have decided they have overpaid him since 2017 so are now demanding repayments for two years of benefits.
According to the advice I’ve managed to obtain you can claim one property as your primary residence and any additional property will be seen as an asset and if you have assets worth more than £16,000 you will not be entitled to benefits.
I have spoken to my local council who have agreed to allow his name to be taken of the second property however I’ve been advised by a financial advisor this will be liable to a large capital gains tax bill.
We have written to DWP to explain to them my father was unaware at the time of the nature of the conditions of owning two properties and how that would affect his claim and also that the local council at the time would not allow the land to be split without all parties being transferred.
It does not help that the local council have now agreed since this situation, if they had agreed two years ago then my father would not have had his benefit terminated nor would he be stuck with a large capital gains tax bill.
Can anyone please advise on what I should do as this case is due to go to the tribunals and I need to put a case forward to represent my father.
As the property had a garden to the side that was vacant, my brother and I spoke to our local council to see whether they would accept the land being split in order for us to build a property next door. This would allow us to be close to him in the foreseeable future.
The council agreed to the land split on the condition that the current titleholders on the current land are to be included on the new land. This was approved and the land was split towards the end of 2016. In 2017 we managed to get contractors to build us a property in which both my brother and I currently reside in, with my parents living next door as our neighbours in the original property.
Recently my father had been contacted by DWP and informed that his benefits have been terminated due to compliance, due to the fact that he know legally owns two properties. They have decided they have overpaid him since 2017 so are now demanding repayments for two years of benefits.
According to the advice I’ve managed to obtain you can claim one property as your primary residence and any additional property will be seen as an asset and if you have assets worth more than £16,000 you will not be entitled to benefits.
I have spoken to my local council who have agreed to allow his name to be taken of the second property however I’ve been advised by a financial advisor this will be liable to a large capital gains tax bill.
We have written to DWP to explain to them my father was unaware at the time of the nature of the conditions of owning two properties and how that would affect his claim and also that the local council at the time would not allow the land to be split without all parties being transferred.
It does not help that the local council have now agreed since this situation, if they had agreed two years ago then my father would not have had his benefit terminated nor would he be stuck with a large capital gains tax bill.
Can anyone please advise on what I should do as this case is due to go to the tribunals and I need to put a case forward to represent my father.
0
Comments
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I think you probably need proper legal advice on this one, as it’s quite involved, and certain legal distinctions probably apply.
If it is two legally distinct properties, and pieces of land, then it does seem to fall foul of the rules on homes owned which are not occupied as a dwelling. There are circumstances where two properties can be considered as one household but I can’t see that they would apply here.
If there are two houses on the one plot of land, and the second property was built due to space restrictions in the original property, I could even see that as possibly being arguable that you are essentially all living together but spaced over two buildings. Again, from what you’ve said, that doesn’t seem to be the case.
It’s two building, two separate pieces of land, and it operates as two distinct households.
I really do think some heavy duty advice from someone with a legal mind would be beneficial though.0 -
I agree with sportsarb, I think you may need more formal advice than can be given on this forum. On the face of it the situation you describe does fall foul of the rules and unfortunately not knowing that this would affect his benefits isn't going to change this.
I think there is a potential issue about the value of the second property in terms of treatment as capital for benefits in that the value has to be an open market value but if a joint owner is not able to sell because the other owners would not agree to a sale then, arguably, there is no value in the property.
Do you have access to a Law Centre? https://www.lawcentres.org.ukInformation I post is for England unless otherwise stated. Some rules may be different in other parts of UK.0 -
You don't say what benefits father is getting. Here is guidance on valuing property in respect of ESA.
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/795065/dmgch52.pdfLand or premises... it goes on but i won't quote it all.
52642 In the case of land or premises the DM should obtain an expert opinion of the market value of the deemed or actual share. In either case the DM should ensure that the expert has taken into account
1. that the claimant is assumed to be a willing seller and
2. whether the other owners would be willing and able to buy the share and
3. whether the other owners would agree to the sale of the asset as a whole and
4. in a case where the other owners would not buy the share or agree to a sale of the asset as a whole
4.1 whether on the facts of the claimant’s particular case the courts would order
4.1.a the sale of the property as a whole or
4.1.b the partition of the property and
4.2 the length of time a purchaser may have to wait before obtaining possession and
Obviously if you and brother are able to but father out this would suggest the value of his share is realisable.Information I post is for England unless otherwise stated. Some rules may be different in other parts of UK.0 -
In 2015 my brother and I decided to help my father by purchasing his council property, in doing so both my parents, my brother and I had become the registered owners of this property. As my father suffers from disability this seemed like the best option to be able to support him financially and be able to be by his side whilst residing in the property. Considering my fathers condition we always knew we would need to support him in the future. We covered his mortgage and tried to help with his condition.
As the property had a garden to the side that was vacant, my brother and I spoke to our local council to see whether they would accept the land being split in order for us to build a property next door. This would allow us to be close to him in the foreseeable future.
The councilagreed to the land split on the condition that the current titleholders on the current land are to be included on the new land. This was approved and the land was split towards the end of 2016. In 2017 we managed to get contractors to build us a property in which both my brother and I currently reside in, with my parents living next door as our neighbours in the original property.
Recently my father had been contacted by DWP and informed that his benefits have been terminated due to compliance, due to the fact that he know legally owns two properties. They have decided they have overpaid him since 2017 so are now demanding repayments for two years of benefits.
According to the advice I’ve managed to obtain you can claim one property as your primary residence and any additional property will be seen as an asset and if you have assets worth more than £16,000 you will not be entitled to benefits.
I have spoken to my local council who have agreed to allow his name to be taken of the second property however I’ve been advised by a financial advisor this will be liable to a large capital gains tax bill.
We have written to DWP to explain to them my father was unaware at the time of the nature of the conditions of owning two properties and how that would affect his claim and also that the local council at the time would not allow the land to be split without all parties being transferred.
It does not help that the local council have now agreed since this situation, if they had agreed two years ago then my father would not have had his benefit terminated nor would he be stuck with a large capital gains tax bill.
Can anyone please advise on what I should do as this case is due to go to the tribunals and I need to put a case forward to represent my father.
Which department did you speak to as the 'council' is vague
I'm only saying as sorry but most council departments do not talk to each other, the department you talked to will possible not have known that your parents were receiving benefits.“You’re only here for a short visit.
Don’t hurry, don't worry and be sure to smell the flowers along the way.”Walter Hagen
365 Day 1p Challenge for 2021 #41 ✅
Jar £440.31/£667.95 and Bank £389.67/£667.950 -
Ignorance of the rules regarding benefit entitlement is not a defence. I'm not suggesting there was any intent on any persons behalf, but DWP should have been informed of any change in your father's circumstances, and ownership of a 2nd property is certainly a change of circumstances. The local council agreeing now for his name to be removed from the 2nd property doesn't change anything as far as liability before the date of change is concerned.0
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I'm afraid I would have to agree, ignorance is never bliss, and advice on this should have been sought before building the 2nd home, again as above you need to seek professional advice.0
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