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Unusual Income Support / Savings Problem
13 Answers
6 years ago my brother recieved back dated state benefits which were due. This process took 2 years but finally recived the money through. I opened a savings account under his name to put this �14,000 in. 6 months ago his income support was stopped which was c�140.00 per week, leaving him only �300 per month from DLA for incapacity, disability benefit.. It was assed that his savings / captial exceeded �16,000. As this originated from backdated benefits that went into the savings this doesn't seem right and effectively this is the government claiming back the money that he went without previously. Can someone please advise if he has a case that his income support should not be stopped? Or if there is a way around the savings investment he has so he drops below the limit.
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In addition to this specifically here is the information on captial savings. : 1.2 Must not have capital over �16,000
Income Support is not payable to a person if s/he and/or partner have capital over �16,000. Those who are permanently in residential care, nursing homes or other types of residential accommodation also lose entitlement if they have over �16,000 in savings and/or capital. The legislation sets out what counts as capital and what can be ignored.
Personal possessions (other than those which would be considered an investment, eg an art collection) and the person's home will not normally be included as savings or capital. Any payment made to a person as the holder of a Victoria or George Cross medal will also be ignored. The surrender value of any insurance policies and certain other savings can be ignored in specific circumstances. For the full list of what is ignored as capital, see Schedule 10 of the Income Support (General) Regulations (NI) 1987 as amended.
A person will still be treated as possessing capital where s/he has deprived her/himself of this capital in order to secure or increase entitlement to Income Support.
As I uncover more paragraph 10 shows can be ignored, Not sure if this covers it but at first reading appears to.
Income Support is not payable to a person if s/he and/or partner have capital over �16,000. Those who are permanently in residential care, nursing homes or other types of residential accommodation also lose entitlement if they have over �16,000 in savings and/or capital. The legislation sets out what counts as capital and what can be ignored.
Personal possessions (other than those which would be considered an investment, eg an art collection) and the person's home will not normally be included as savings or capital. Any payment made to a person as the holder of a Victoria or George Cross medal will also be ignored. The surrender value of any insurance policies and certain other savings can be ignored in specific circumstances. For the full list of what is ignored as capital, see Schedule 10 of the Income Support (General) Regulations (NI) 1987 as amended.
A person will still be treated as possessing capital where s/he has deprived her/himself of this capital in order to secure or increase entitlement to Income Support.
As I uncover more paragraph 10 shows can be ignored, Not sure if this covers it but at first reading appears to.
-- answer removed --
Point 7 seems to be most relevant:
SCHEDULE 10
Regulation 46(2)
CAPITAL TO BE DISREGARDED
1. The dwelling occupied as the home but, notwithstanding regulation 23 (calculation of income and capital of members of claimant's family and of a polygamous marriage), only one dwelling shall be disregarded under this paragraph.
2. Any premises acquired for occupation by the claimant which he intends to occupy within26 weeks of the date of acquisition or such longer period as is reasonable in the circumstances to enable the claimant to obtain possession and commence occupation of the premises.
3. Any sum directly attributable to the proceeds of sale of any premises formerly occupied by the claimant as his home which is to be used for the purchase of other premises intended for such occupation within 26 weeks of the date of sale or such longer period as is reasonable in the circumstances to enable the claimant to complete the purchase.
4. Any premises occupied in whole or in part by�
(a) a partner or relative of any member of the family where that person is aged 60 or over or is incapacitated;
(b) the former partner of a claimant where the claimant is not to be treated as occupying a dwelling as his home; but this provision shall not apply where the former partner is a person from whom the claimant is estranged or divorced.
5. Any reversionary interest.
6. The assets of any business owned in whole or in part by the claimant and for the purposes of which he is engaged as a self-employed earner or, if he has ceased to be so engaged, for such period as may be reasonable in the circumstances to allow for disposal of any such asset.
SCHEDULE 10
Regulation 46(2)
CAPITAL TO BE DISREGARDED
1. The dwelling occupied as the home but, notwithstanding regulation 23 (calculation of income and capital of members of claimant's family and of a polygamous marriage), only one dwelling shall be disregarded under this paragraph.
2. Any premises acquired for occupation by the claimant which he intends to occupy within26 weeks of the date of acquisition or such longer period as is reasonable in the circumstances to enable the claimant to obtain possession and commence occupation of the premises.
3. Any sum directly attributable to the proceeds of sale of any premises formerly occupied by the claimant as his home which is to be used for the purchase of other premises intended for such occupation within 26 weeks of the date of sale or such longer period as is reasonable in the circumstances to enable the claimant to complete the purchase.
4. Any premises occupied in whole or in part by�
(a) a partner or relative of any member of the family where that person is aged 60 or over or is incapacitated;
(b) the former partner of a claimant where the claimant is not to be treated as occupying a dwelling as his home; but this provision shall not apply where the former partner is a person from whom the claimant is estranged or divorced.
5. Any reversionary interest.
6. The assets of any business owned in whole or in part by the claimant and for the purposes of which he is engaged as a self-employed earner or, if he has ceased to be so engaged, for such period as may be reasonable in the circumstances to allow for disposal of any such asset.
7. Any arrears of, or any concessionary payment made to compensate for arrears due to the non-payment of�
(a) any payment specified in paragraph 6, 8 or 9 of Schedule 9 (other income to be disregarded);
(b) an income-related benefit or supplementary benefit, family income supplement under the Family Income Supplements Act 1970[160] or housing benefit under Part II of the Social Security and Housing Benefits Act 1982;
but only for a period of 52 weeks from the date of the receipt of the arrears or of the concessionary payment.
8. Any sum�
(a) paid to the claimant in consequence of damage to, or loss of the home or any personal possession and intended for its repair or replacement; or
(b) acquired by the claimant (whether as a loan or otherwise) on the express condition that it is to be used for effecting essential repairs or improvements to the home,and which is to be used for the intended purpose, for a period of 26 weeks from the date on which it was so paid or acquired or such longer period as is reasonable in the circumstances to enable the claimant to effect the repairs, replacement or improvements.
9. Any sum�
(a) deposited with a housing association as defined in section 1(1) of the Housing Associations Act 1985[161] or section 338(1) of the Housing (Scotland) Act 1987[162] as a condition of occupying the home;
(b) which was so deposited and which is to be used for the purchase of another home, for the period of 26 weeks or such longer period as is reasonable in the circumstances to complete the purchase.
10. Any personal possessions except those which had or have been acquired by the claimant with the intention of reducing his capital in order to secure entitlement to supplementary benefit or income support or to increase the amount of that benefit.
11. The value of the right to receive any income under an annuity and the surrender value (if any)
(a) any payment specified in paragraph 6, 8 or 9 of Schedule 9 (other income to be disregarded);
(b) an income-related benefit or supplementary benefit, family income supplement under the Family Income Supplements Act 1970[160] or housing benefit under Part II of the Social Security and Housing Benefits Act 1982;
but only for a period of 52 weeks from the date of the receipt of the arrears or of the concessionary payment.
8. Any sum�
(a) paid to the claimant in consequence of damage to, or loss of the home or any personal possession and intended for its repair or replacement; or
(b) acquired by the claimant (whether as a loan or otherwise) on the express condition that it is to be used for effecting essential repairs or improvements to the home,and which is to be used for the intended purpose, for a period of 26 weeks from the date on which it was so paid or acquired or such longer period as is reasonable in the circumstances to enable the claimant to effect the repairs, replacement or improvements.
9. Any sum�
(a) deposited with a housing association as defined in section 1(1) of the Housing Associations Act 1985[161] or section 338(1) of the Housing (Scotland) Act 1987[162] as a condition of occupying the home;
(b) which was so deposited and which is to be used for the purchase of another home, for the period of 26 weeks or such longer period as is reasonable in the circumstances to complete the purchase.
10. Any personal possessions except those which had or have been acquired by the claimant with the intention of reducing his capital in order to secure entitlement to supplementary benefit or income support or to increase the amount of that benefit.
11. The value of the right to receive any income under an annuity and the surrender value (if any)
-- answer removed --
12.�(1) Where the funds of a trust are derived from a payment made in consequence of any personal injury to the claimant the value of the trust fund and the value of the right to receive any payment under that trust, for a period of two years or such longer period as is reasonable in the circumstances beginning�
(a) if, at the date of the payment the claimant or his partner is in receipt of an income-related benefit, on that date;
(b) in any other case, on the date on which an income-related benefit is first payable to the claimant or his partner after the date of that payment,
but, for the purposes of regulation 17, 18, 21, 44(5) and 71 and Schedules 4 and 5 (applicable amounts and modifications in respect of children and young persons) in calculating the capital of a child or young person there shall be no limit as to the period of disregard under this paragraph.
(2) For the purposes of sub-paragraph (1) any reference to an income-related benefit shall be construed as if it included a reference to supplementary benefit.
13. The value of the right to receive any income under a life interest or from a liferent.
14. The value of the right to receive any income which is disregarded under paragraph 11 of Schedule 8 or paragraph 23 of Schedule 9 (earnings or other income to be disregarded).
15. The surrender value of any policy of life insurance.
16. Where any payment of capital falls to be made by instalments, the value of the right to receive any outstanding instalments.
17. Except in the case of a person to whom section 23 of the Act (trade disputes) applies and for so long as it applies, any payment made under section 1 of the Child Care Act 1980 (duty of local authorities to promote welfare of children) or, as the case may be, section 12 of the Social Work (Scotland) Act 1968 (general welfare).
(a) if, at the date of the payment the claimant or his partner is in receipt of an income-related benefit, on that date;
(b) in any other case, on the date on which an income-related benefit is first payable to the claimant or his partner after the date of that payment,
but, for the purposes of regulation 17, 18, 21, 44(5) and 71 and Schedules 4 and 5 (applicable amounts and modifications in respect of children and young persons) in calculating the capital of a child or young person there shall be no limit as to the period of disregard under this paragraph.
(2) For the purposes of sub-paragraph (1) any reference to an income-related benefit shall be construed as if it included a reference to supplementary benefit.
13. The value of the right to receive any income under a life interest or from a liferent.
14. The value of the right to receive any income which is disregarded under paragraph 11 of Schedule 8 or paragraph 23 of Schedule 9 (earnings or other income to be disregarded).
15. The surrender value of any policy of life insurance.
16. Where any payment of capital falls to be made by instalments, the value of the right to receive any outstanding instalments.
17. Except in the case of a person to whom section 23 of the Act (trade disputes) applies and for so long as it applies, any payment made under section 1 of the Child Care Act 1980 (duty of local authorities to promote welfare of children) or, as the case may be, section 12 of the Social Work (Scotland) Act 1968 (general welfare).
18. Any social fund payment.
19. Any refund of tax which falls to be deducted under section 26 of the Finance Act 1982[163] (deductions of tax from certain loan interest) on a payment of relevant loan interest for the purpose of acquiring an interest in the home or carrying out repairs or improvements in the home.
20. Any capital which under regulations 41 and 44(1) (capital treated as income and modifications in respect of children and young persons) is to be treated as income.
21. Where a payment of capital is made in a currency other than sterling, any banking charge or commission payable in converting that payment into sterling.
19. Any refund of tax which falls to be deducted under section 26 of the Finance Act 1982[163] (deductions of tax from certain loan interest) on a payment of relevant loan interest for the purpose of acquiring an interest in the home or carrying out repairs or improvements in the home.
20. Any capital which under regulations 41 and 44(1) (capital treated as income and modifications in respect of children and young persons) is to be treated as income.
21. Where a payment of capital is made in a currency other than sterling, any banking charge or commission payable in converting that payment into sterling.
Section 7 is relevant but it states
Any arrears of, or any concessionary payment made to compensate for arrears due to the non-payment of�
(a) any payment specified in paragraph 6, 8 or 9 of Schedule 9 (other income to be disregarded);
(b) an income-related benefit or supplementary benefit, family income supplement under the Family Income Supplements Act 1970[160] or housing benefit under Part II of the Social Security and Housing Benefits Act 1982;
but only for a period of 52 weeks from the date of the receipt of the arrears or of the concessionary payment.
So after a year, any arrears still in the account ARE taken into consideration
Any arrears of, or any concessionary payment made to compensate for arrears due to the non-payment of�
(a) any payment specified in paragraph 6, 8 or 9 of Schedule 9 (other income to be disregarded);
(b) an income-related benefit or supplementary benefit, family income supplement under the Family Income Supplements Act 1970[160] or housing benefit under Part II of the Social Security and Housing Benefits Act 1982;
but only for a period of 52 weeks from the date of the receipt of the arrears or of the concessionary payment.
So after a year, any arrears still in the account ARE taken into consideration
Lolpeters must have created a record for the longest answer given by the person asking the question! Interesting stuff but most of the pages and pages of text lopeters pasted in isn't relevant.
Rather than wading through all this text it's better to focus on the key point (as Thecorbyloon did so well) plus a link to the relevant DWP webpage.
Rather than wading through all this text it's better to focus on the key point (as Thecorbyloon did so well) plus a link to the relevant DWP webpage.
-- answer removed --
Were the back-dated payments for DLA or Income Support?
I think that if they have classed your brothers payment as savings you may receive a letter asking for the Income Support paid over the last 5 years back.
Has the 14k increased to over 16k due to interest?
Make an appointment to see a Citizens Advice advisor to help you.
I think that if they have classed your brothers payment as savings you may receive a letter asking for the Income Support paid over the last 5 years back.
Has the 14k increased to over 16k due to interest?
Make an appointment to see a Citizens Advice advisor to help you.
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