Separation, Savings & Benefits

greensparkle1234 · 20 November 2018 at 5:27PM

Hi All,

My husband and I have decided to separate and I'm wondering whether if he holds on to the house (changing to interest only) and I get my share of the equity, would that affect my eligibility for claiming income support and child tax credits?

Thanks!

[Deleted User] · 20 November 2018 at 5:35PM

Yes to income support as that is means tested, no to tax credits as that's only based on income.

But depending where you live you might not claim either of those. You might need to claim universal credit which does look at savings.

poppy12345 · 20 November 2018 at 5:38PM

Check your area here.
http://ucpostcode.entitledto.co.uk/ucdate

pmlindyloo · 20 November 2018 at 5:42PM

Are you saying that your husband will buy you out and the house will be put solely into his name and his name on the mortgage only?

So, if this is the case then you will only be eligible for income support if you have a child under 5 yrs old and have savings less than £16000. If you have savings between £6k and £16K then for every £250 over the £6K would mean your Income Support would be reduced by £1 per week.

Child tax credits would not be affected by savings unless the interest from them was more than £300 pa.

To complicate matters further if you are in a full service Universal Credit area then you would have to claim Universal Credit.

Where do you intend to live?

sammyjammy · 20 November 2018 at 7:44PM

Whether its a factor in your decision making or not I don't know but it is very unlikely your husband will be able to switch to interest only.

TELLIT01 · 21 November 2018 at 9:17AM

Under Income Support rules money from the sale of a house can be disregarded for 6 months if the intention is to use that money to purchase another property. I don't know if the same applies under UC rules.

greensparkle1234 · 21 November 2018 at 10:17AM

Hi everyone,

Thank you for your replies

In an ideal world, it'd be great for my husband to buy me out and then for him to go interest only but having looked into it after I posted this, I don't think he'd make enough of a saving each month to be able to afford to pay me maintenance, plus obviously he'll lose my income which also goes towards the house.

Realistically, we will have to sell the house and after fees etc., I think I may have around £50,000 - some of this I will need to use to buy furniture and the rest I will put into savings.
I don't want to buy straight away - I will look to rent, maybe a 2 bed (c.£600/month) rather than a 3 bed (c.£900/month). I would prefer a 3 bed but there is quite a saving between the 2 sizes - so long as I can find a 2 bed where the main bedroom is big enough for my 2 boys to share - I'd be OK with that. If not, then a 3 bed may be the better option. A 2 bed would allow me to do more and also hopefully save a bit each month too.
In time, I would hope to meet someone and then maybe I'd end up buying a place with them. Or buy my own place a bit later on - I think I want to bide my time.

TELLIT01 · 21 November 2018 at 12:23PM

greensparkle1234 wrote: »

Hi everyone,

Thank you for your replies

I don't want to buy straight away - I will look to rent.....

If you aren't actively looking to purchase a new property, I'm pretty sure the money from the sale of the house will be taken into account immediately. The disregard period is specifically to give the claimant time to find a property.

Separation, Savings & Benefits

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