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    • leviathan
    • By leviathan 11th Oct 19, 12:31 PM
    • 142Posts
    • 86Thanks
    UC & depreviation of assets
    • #1
    • 11th Oct 19, 12:31 PM
    UC & depreviation of assets 11th Oct 19 at 12:31 PM
    I'm looking for some advice please on what constitutes depreviation of assets and how long the time scales are.

    I own my home (no mortgage) and despite many years of procrastination I can show that there has always been a plan to spend my savings on an extension.
    If I were to go ahead with that plan which would take me below the 16k savings threshold and cost around 60k to do, would I be accused of disposing my savings wilfully and denied UC if I was to try to claim it later, say 12months later.

    Also the same question for if I put 20k into premium bonds in my kids names. This is then their asset and no longer mine.
    When does it become not considered as disposal for UC claim purposes ?

    I'm not planning to claim UC and setting up asset disposal to take this route. That is not what this thread is about. That's fraud and I want to protect myself from being accused of it.

    But my current work climate and TBH I expect a global recession in 2020, I'm wondering if I would be suffering despite IMHO having "done the right thing" through my life thus far such as accruing savings.

    I'm not paid highly, we just live frugally.
Page 1
    • Sea Shell
    • By Sea Shell 11th Oct 19, 12:51 PM
    • 2,619 Posts
    • 4,718 Thanks
    Sea Shell
    • #2
    • 11th Oct 19, 12:51 PM
    • #2
    • 11th Oct 19, 12:51 PM
    I don't know, but to me it seems that surely people should be able to live their lives, without having to worry about "what if" I need benefits in the future.

    Anyone's life can change for the worse at any time!!

    As I understand it, it's desposing of assets "on purpose" that's the issue.

    But as you've raised it, and have reason to think you will need to claim benefits in the near future, then I wouldn't be surprised if questions are asked about where your money's gone!
    " That pound I saved yesterday, is a pound I don't have to earn tomorrow " JOB DONE!!
    This should now read "It's time to start digging up those Squirrelled Nuts"!!!
    • calcotti
    • By calcotti 11th Oct 19, 1:41 PM
    • 3,535 Posts
    • 2,401 Thanks
    • #3
    • 11th Oct 19, 1:41 PM
    • #3
    • 11th Oct 19, 1:41 PM
    It is only deprivation of capital if a significant part of the purpose of disposing of the capital was to qualify for benefits or increase the amount of benefit.

    The DWP guidance says this
    Deprivation of capital
    The law
    H1795 The law says people are treated as having capital they do not have if they deprive themselves of capital to get UC or more UC1. The capital people are treated as having is called notional capital.

    H1796 People are not treated as having capital of which they have deprived themselves if
    1. it reduces or pays a debt owed by the person or
    2. they purchase goods and services and that expenditure was reasonable in the circumstances of that person’s case.

    Have people deprived themselves of capital
    Meaning of deprive
    H1815 The meaning of deprive is not a question of law and should be given its normal every day meaning. So claimants have deprived themselves of capital if they no longer have it even if they use it to get other capital or personal possessions.
    Note: This is subject to the provisions of H1796. So for example a person may have bought a second car but they are single and can provide no reason for why they need 2 cars, so the DM does not think the expenditure was reasonable.

    Have people deprived themselves of capital for the purpose of getting UC or more UC
    Onus of proof
    H1825 DMs have to show the claimant's or partner's purpose was to get UC or more benefit if they decide claimants or partners have deprived themselves of capital. Getting UC or more UC may not be the claimant's or partner's predominant purpose but it must be a significant one. So when claimants give away all their capital to a relative just before claiming UC their
    1. main, or predominant, purpose may be to benefit the relative and
    2. intention, or significant purpose, may be to reduce their capital so they can get UC or more UC.

    H1826 DMs have to decide if the claimant's or partner's significant purpose was to get UC or more UC. The DM has to make such a decision each time claimants or partners deprive themselves of capital. So if a claimant has spent their capital on several things the DM has to decide the claimant's purpose for each act of deprivation.

    H1827 Normally there is no direct evidence to show the claimant's or partner's purpose was to get UC or more UC. So the DM has to consider all the facts of each case when making the decision.
    At the moment you appear to just be expressing a general anxiety about the future (which many of us might share). Unless you have clear reason to think you about to have to rely on the benefit system, deprivation of capital rules should not apply because you are not expecting to have to claim. However if you were to claim in the next 12 months you should expect to be asked about how your capital has been disposed of and the DM has discretion.

    If you are going to be left with very little capital (if any) it might be argued that it was not reasonable to give away so much capital to relatives such that you had nothing left to assist yourself in a time of need. However that's just my observation - I know nothing of your family circumstances etc
    • TELLIT01
    • By TELLIT01 11th Oct 19, 2:55 PM
    • 7,058 Posts
    • 7,666 Thanks
    • #4
    • 11th Oct 19, 2:55 PM
    • #4
    • 11th Oct 19, 2:55 PM
    Money spent when there is nothing to indicate any intent to claim Income Related benefits in the period immediately after spending cannot be classed as Deprivation of Capital.

    There is no problem in doing what is outlined by the OP, although I do wonder about the advisability of leaving yourself too short of capital. Spending on an extension wouldn't raise any flags anyway, unless as said above, there was anything to suggest you intended to claim benefits.
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