Can UC do this

[Ohfear688754]

I am not looking for angry comments at me, just genuine advice.

2022 I was on Tax credits and I got divorced. I got X amount of money which was reported correctly and used in June 2023 to buy a house, leaving me with about 8k in savings.

May 2024 I was moved over to UC where all accounts and savings were declared.

Fast forward to yesterday where I have a Compliance call with UC (basically in the Fraud arena) who have recieved HMRC figures for 2023/2024 which shows that I had savings over 16k thst year.

They are concerned that because I had savings then that I might have had savings I didn’t declare when I applied. Went through all my accounts and gave current amounts and explained I had had that money, but that I used it to buy a house and it was prior to my UC claim and that when they get the 2024/2025 tax details they will see that.

Not good enough and they have asked for permission to contact all my banks and get statements for that tax year so they can “see” if the money went.

Is this right? I wasn’t even on UC then, I was on Tex credits and I declared all the interest I received, so it’s clear there was money.

Im not concerned because I know exactly where and when the money went and nothing will be found, but it seems a bit long reaching for UC to be able to check for a period of time when I wasn’t even claiming it? The rules for Tax credits were different, so I wasn’t doing any thing wrong then either?

Yes they can do this
Yes they have

Why? Because overpayment of benefits due to undeclared savings is a matter for HMRC. The type of benefit is irrelevant. Money is owed to the tax payer and the HMRC will pursue the return of which

EDIT you are asking whether reasonable for HMRC to conduct thorough investigations to ensure no money is owed? Hell yes Op

But it doesn’t look like you have anything to worry about out

Let them see the figures. They are looking out for fraud and something has triggered an investigation. Sounds as though you have been compliant but when you’re relying on other people’s money you have to follow the rules.
Must be worrying but it’s just a process and it’s good there are these checks.

I think my question is thst this is a tax year I wasn’t even on UC I was on tax credits and tax credits were also able to see my savings?? They will have recieved HMRC figures.

I don’t have any concerns because the money was above board, it was declared and it is now spent, it’s just more that they can request details when I was claiming a different benefit with entirely different savings rules

If you have reported correctly, then I wouldn't panic. And yes, I can see their logic.

You are relying on government provided funds so they are correctly checking.

They are conducting an investigation
And you are asking whether they are entitled to do so

YES!

Tac credits don't take into account savings. I know because I had savings and declared them, they said it was fine. When I moved over automatically to UC they said I get 12 months grace and the savings are fine. Obviously when those 12 months are up, I'll get kicked off UC. Luckily I got a job by then. You need to speak to them and clarify you were on Tax credits and the money was temporary as you used it to buy a property to live in. Ask about the 12 months grace period of transferring to UC with savings too. I'm confident you'll be okay with the timeline. Just talk to them, you'll feel alot better.

Morning,

Yes they know about the grace period. They are saying that the concern is that I had the savings when I applied for UC (I didn’t) and that I have them now and shouldn’t be entitled after the grace period (I don’t)

My issue is the insinuation that this is a fact, based on HMRC records from a time I didn’t claim UC and was claiming a benefit when the rules were different.

If they were to wait for the 2024/2025 HMRC records they would see thst.

It seems a little heavy handed and big brother that they are able to check your historical bank transactions. Are they worried you have deprived yourself of capital immediately before claiming and have transferred the money somewhere else to effectively hide it?

If you need the universal credit I would show them as you have done nothing wrong but I do understand why you have raised an eyebrow at the request.

Thankyou. You get what I’m saying. I never denied having the money, but I had it under different rules with Tax Credits and it was pretty much gone a year almost before I claimed UC.

I declared what I had, and I have explained on the phone that I did have that money and given the exact date I bought my house. They can see that I have a house because I don’t claim housing costs etc.

The money was declared to Tax Credits and I declared the interest and I declared to UC the 8k I had left over, so it seems a bit much to get statements from a time I admitted I had the money and declared it and a fair while before I was moved to UC

To be fair this is the downside of being reliant on government handouts. If you have nothing to hide you should simply comply. Yes, it might cause you some inconvenience but surely you can see that they have responsibility to safeguard public money.
They will either see that the money was transferred to pay towards your new house and leave you alone, or that the money went elsewhere at which point you might be accused of deprivation of capital or hiding savings in order to claim benefits.
I understand this is an inconvenience to you but as a taxpayer I am glad they do take these things seriously.

Just to clarify.

I am also a taxpayer and this is a top up.

I never said you weren’t.
But with this in mind I don’t understand why you are questioning the investigation. People have to jump through all sorts of hoops when dealing with the government agencies. This is no different.

I’m questioning it because I believe it is heavy handed and relates to a time before I was on UC where the benefits rules were different, and I have explained to UC the money I had and where it went.

It was declared to Tax credits at the time so there’s never been any doubt that I had it and I have fully explained where it went.

It seems a reach to be allowed to gather statements for a period I was not on UC “just in case” when I was on UC I didn’t declare it.

The whole suggestion is thst I am dishonest based on no evidence of dishonest behaviour at all

If you weren't on UC at the time I don't think they should be digging around in those statements.

I don’t think it matters, let them waste their time. Sounds like you have nothing to worry about.

That’s my feelings.

My money was all but gone in May 23 when I bought my house.

I was moved to UC in May/June 2024.

I declared the savings/accounts I had then, but HMRC records work a year in arrears, so UC have been sent 2023/2024 which shows that during the April-April period I had X amount, which I did, until the May.

They are now fishing to see if they can get me for not losing enough money for savings and are suggesting that from May 2025 I wasn’t entitled to it. Based on an HMRC records from 23-24

Not only that, but when they see that I am telling the truth it has to go to a decision maker so they can decided if I didn’t have money I don’t have.

The whole thing is an utter waste of time and probably money on their side.

I think they look back to see if someone had more than they declared and basically then spent it on themselves to get rid of it so they could then claim. Deprivation of assets.

That’s obviously not you. But some do, so they need to clarify the situation.

It’s annoying but just the way it is.

My office does a 10% check on travel expenses. You always feel a bit ‘oh no’ if it’s your turn but it’s randomly selected. Perhaps the benefits system is the same. Who knows. It’s just a process and youll be in the clear

Dont Take it personally. It’s good they are doing it ro more people to make sure they aren't At It. Far too much benefit fraud going on.

They're just checking that you are actually eligible to claim. Which is reasonably. Either let them, or manage without UC. It's not personal. It's cheaper for them to check than to give money to people who don't need it.

It sounds like neither Tax Credits nor Universal Credit departments have seen any evidence that the money you spent in May 2023 was spent on a house purchase.
That’s probably the only thing they need to clarify - it doesn’t matter that you don’t have the savings now because they still need to check what you spent the money on.
Despite it having occurred while you were under different benefit system, it is relevant because there is a chance that your UC claim was fraudulent (I’m not saying it was but they have to check it).

It should not be to much hassle to show them one month bank statement from May 2023 showing the house purchase transfer and subsequently your savings going down.
Like pp said it’s not different to employees being audited randomly for their expenses claims and having to dig out receipts for trains etc.

It sounds like you are saying they should just accept that you spent the money back in 2023 on house purchase based on your declaration only and not seek evidence?

They're not suggesting you're dishonest, they don't know anything about you. Your separation and house purchase just happened to have the same timings and pattern as someone who was trying to hide savings before switching to UC. It will have been flagged up for further investigation for this reason. They just want to check if it's legitimate or not, in your case it's legitimate and you have nothing to worry about. There's nothing personal about it to get offended over.

If there’s nothing to worry about (and you didn’t conceal or lie) then you should let them conduct their investigations. You can’t accept government money and not expect them look into your financial situation and history - that’s part of what you signed up for!

Tax credits and UC are the same department with a new name

you were receiving government funds in the form of benefit. You were claiming benefits in the years and they can check.

its intrusive, but unfortunately in some cases needed

I don’t understand why anyone would ask ‘can they do this?’ or think it’s over the top. Frankly it’s good to know that HMRC are checking there isn’t fraud, as long as it’s done fairly of course. It’s normal for taxpayers to have their affairs reviewed, why not benefit claimants. I believe the law was changed recently to allow HMRC to access all bank accounts.

Are they? I thought tax credits was DWP and UC is HMRC?