Bit of a Pickle, Family Loan and Pension Credit
Options
chunky1972
Posts: 9 Forumite
in Loans
Hello all,
Please bare with me on this is my first post and i'm not very clued up regarding the financial side of life i'm afraid. I am in bit of a pickle with a few issues and concerns and not sure if I am asking the correct questions in the right thread. If anyone can point me in the correct direction then please feel free, but here goes.
I have recently been knocked back from a few loan applications and the loans I can get are of high interest so I knocked them back. I have recently took a loan of £20k off my Mum and paying her back monthly. We did that as it was what we though was the easiest option.
Since then my Mum has recently had a Pension Credit review (which I also need to ask questions about but not sure if this is the right place) and the DW&P have reduced her Weekly amount by £23 a week. The paperwork inst really easy to understand, but from what I can gather in the past she hasn't alerted them to a change of circumstances, that could be regarding the amount of savings she had. This is all new to me and for my mum who is disabled and visually impaired is confusing and distressing for her, so I need help and advice regarding this as well, as she also owes them £350 as she has been overpaid. My Dad passed away 10 years ago and I have had no involvement in Mum's finances until very recently, I completely thought everything was in order.
Now, moving back to the loan I have read this morning that Mum will need to advised the DW&P every time there is a change of circumstances to her savings and this we will do this week. But is she going to be questioned on where the £20,000 has gone since they have only recently done a review and Mum had a letter last week, and if I tell them the truth, that it was a loan to me and that we are paying her back, will that be seen as a gift and will I need to pay tax on this or because we are paying the loan back to mum will things be okay?
I'm sorry if this may not make any sense, but just a bit worried at the moment as I have been naive until now and didn't have a clue the does and don'ts regarding money, especially Money that belongs to a parent.
If anyone can help or advise in any way I will be very grateful.
Please bare with me on this is my first post and i'm not very clued up regarding the financial side of life i'm afraid. I am in bit of a pickle with a few issues and concerns and not sure if I am asking the correct questions in the right thread. If anyone can point me in the correct direction then please feel free, but here goes.
I have recently been knocked back from a few loan applications and the loans I can get are of high interest so I knocked them back. I have recently took a loan of £20k off my Mum and paying her back monthly. We did that as it was what we though was the easiest option.
Since then my Mum has recently had a Pension Credit review (which I also need to ask questions about but not sure if this is the right place) and the DW&P have reduced her Weekly amount by £23 a week. The paperwork inst really easy to understand, but from what I can gather in the past she hasn't alerted them to a change of circumstances, that could be regarding the amount of savings she had. This is all new to me and for my mum who is disabled and visually impaired is confusing and distressing for her, so I need help and advice regarding this as well, as she also owes them £350 as she has been overpaid. My Dad passed away 10 years ago and I have had no involvement in Mum's finances until very recently, I completely thought everything was in order.
Now, moving back to the loan I have read this morning that Mum will need to advised the DW&P every time there is a change of circumstances to her savings and this we will do this week. But is she going to be questioned on where the £20,000 has gone since they have only recently done a review and Mum had a letter last week, and if I tell them the truth, that it was a loan to me and that we are paying her back, will that be seen as a gift and will I need to pay tax on this or because we are paying the loan back to mum will things be okay?
I'm sorry if this may not make any sense, but just a bit worried at the moment as I have been naive until now and didn't have a clue the does and don'ts regarding money, especially Money that belongs to a parent.
If anyone can help or advise in any way I will be very grateful.
0
Comments
-
Tax isn't the problem - but possible 'deprivation of assets' is.
It's possible that DWP may see that 'giving' you this money is your mum's way of increasing her means tested benefits, and assess her as still having this £20K as savings.
I'm not an expert on benefits, but my understanding is that anyone who has more than £16K in savings may not be entitled to any means tested benefits, including pension credit.
Speak to one of the benefit advisors at the CAB (Citizen's Advice Bureau).0 -
I will contact the CAB as soon as possible for advice. Thank you very much.0
-
chunky1972 wrote: »I will contact the CAB as soon as possible for advice. Thank you very much.
I've just had a bit of a google, and I'm still unsure about pension credit (there are different types) but what is clear is that housing benefit (if your mum claims that) is not payable if the claimant has more than £16K in savings.
CAB are the experts - good luck.0 -
What possessed you to take £20k off your widowed, disabled, partially blind, low income mother that you probably will never fully pay back due to you being a high credit risk?0
-
Thank you. Do you know if the CAB advice line will be able to answer questions, or is it a case of trying to get in at my local CAB in person? Only asking as I have 2 jobs in the day and booking time off is a pain.0
-
How much are you paying back a month?
Is interest being paid?
Do you think they will believe this is a loan rather than an attempt to continue claiming benefits. Bit of a coincidence timing wise.0 -
Where did the 20 large go? Pay off other debts, holiday, new car?
Can you not put yourself back to the position you where in previously?0 -
AnotherJoe wrote: »What possessed you to take £20k off your widowed, disabled, partially blind, low income mother that you probably will never fully pay back due to you being a high credit risk?
Desperate measures, as i'm struggling to put a roof over my own house despite 2 jobs. The loan has not left Mum without any money. Believe me I did not like asking and feel awful for it, but if it had left mum short or in financial trouble then I would not of done it. I also help mum out quite a lot, so in case you think i'm some heartless deviant, i'm not.0 -
How much are you paying back a month?
Is interest being paid?
Do you think they will believe this is a loan rather than an attempt to continue claiming benefits. Bit of a coincidence timing wise.
£250 minimum is being paid back and I will pay extra when I have it.
It may look like a coincidence, but believe me I never had a clue and like I said i'm no expert in all of this, hence why I have asked for help.0 -
foxy-stoat wrote: »Where did the 20 large go? Pay off other debts, holiday, new car?
Can you not put yourself back to the position you where in previously?
It paid off debts. We both work and I have 2 jobs and our outgoings were more than our in comings, due to bills and interest constantly increasing.
I would never of asked for a loan for a holiday or new car.0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608.1K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards