Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • GBbusines
    • By GBbusines 16th Apr 19, 9:53 AM
    • 4Posts
    • 0Thanks
    GBbusines
    Can banks take benefits for overdraft repayments?
    • #1
    • 16th Apr 19, 9:53 AM
    Can banks take benefits for overdraft repayments? 16th Apr 19 at 9:53 AM
    I seen this law;

    "Social Security Administration Act 1992
    Miscellaneous
    Certain benefit to be inalienable **

    187- Subject to the provisions of this Act, every assignment of, or charge on-
    (a)benefit as defined in section 122 of the Contributions and Benefits Act;
    (b)any income-related benefit; or
    (c)child benefit,
    and every agreement to assign or charge such benefit shall be void; and, on the bancrupcy of the beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors."

    And looked up the definition of "inalienable" which means, "not subject to being taken away from or given away by the possessor."

    So how can a bank argue otherwise? Can any one explain this law more please? Can anyone provide more laws to apply to this situation please?
Page 1
    • Afraid of Kittens
    • By Afraid of Kittens 16th Apr 19, 10:12 AM
    • 233 Posts
    • 254 Thanks
    Afraid of Kittens
    • #2
    • 16th Apr 19, 10:12 AM
    • #2
    • 16th Apr 19, 10:12 AM
    I seen this law;

    "Social Security Administration Act 1992
    Miscellaneous
    Certain benefit to be inalienable **

    187- Subject to the provisions of this Act, every assignment of, or charge on-
    (a)benefit as defined in section 122 of the Contributions and Benefits Act;
    (b)any income-related benefit; or
    (c)child benefit,
    and every agreement to assign or charge such benefit shall be void; and, on the bancrupcy of the beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors."

    And looked up the definition of "inalienable" which means, "not subject to being taken away from or given away by the possessor."

    So how can a bank argue otherwise? Can any one explain this law more please? Can anyone provide more laws to apply to this situation please?
    Originally posted by GBbusines
    This old chestnut again.

    Yes they can.

    https://gclaw.wordpress.com/2014/09/04/are-welfare-benefits-exempt-from-bank-charges-under-section-1871-of-the-social-security-administration-act-1992/

    https://legalbeagles.info/forums/forum/money-debt/banks-and-building-societies/40850-claim-benefits-then-bank-charges-are-unlawful-the-truth-is-that-they-are-lawful

    The only way to protect your benefits is have them paid into a seperate bank account with no overdraft facilities and no bank charges.
    Last edited by Afraid of Kittens; 16-04-2019 at 10:17 AM.
    I enjoy flower arranging, kittens, devil worship, the study of serial killers and their methods and road kill jigsaws.
    • sportsarb
    • By sportsarb 16th Apr 19, 10:16 AM
    • 776 Posts
    • 536 Thanks
    sportsarb
    • #3
    • 16th Apr 19, 10:16 AM
    • #3
    • 16th Apr 19, 10:16 AM
    From the link above:

    “The purpose of the Social Security Administration Act 1992 Section 187 and section 45 of the Tax Credits Act 2002 is to prevent people’s benefit money being at risk by it being assigned over to a third party in settlement of a debt. It is not intended to prohibit the application of bank charges. Bank charges are in the nature of an expense, and are incurred by the holder of the account; tax credits and benefits are payable in order to help customers meet their expenses, and as such it is legitimate for banks to deduct charges from the balance of an account held in that bank, whether the money paid into the account comes from tax credits, benefits or other sources, such as earnings.”

    It would be perverse not to allow the bank to use the money to recover their debt.

    Switch payment to another account, however, and the bank with which you have a debt cannot touch it.
    • w06
    • By w06 16th Apr 19, 10:24 AM
    • 817 Posts
    • 1,160 Thanks
    w06
    • #4
    • 16th Apr 19, 10:24 AM
    • #4
    • 16th Apr 19, 10:24 AM
    If they weren't it would surely mean that banks wouldn't allow folk in receipt of benefits to have an allowed overdraft facility. I for one would be pretty stuck without mine, circumstances currently mean my UC pays it off each month
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

36Posts Today

1,502Users online

Martin's Twitter
  • Have a great Easter, or a chag sameach to those like me attending Passover seder tomorrow. I?m taking all of next? https://t.co/qrAFTIpqWl

  • RT @rowlyc1980: A whopping 18 days off work for only 9 days leave! I?ll have a bit of that please......thanks @MartinSLewis for your crafty?

  • RT @dinokyp: That feeling when you realise that you have 18 days of work and only used 9 days of your annual leave! Thanks @MartinSLewis h?

  • Follow Martin