inheritance, will it affect our benifits?

[JingleTits]

Im posting on here cos i know more people will see it and can therfore give more advise.

Myself and my husband are in reciept of some benifits. He works and we have four DC's. Everything we get were entitled to, it's things like working tax credits etc.

My husband is due to recieve about £10,000 inheritance in the next 12 months or so. My question is will the benifits take this into account and ammend what we recieve or as its a one off payment will they leave it alone??

Does anyone know? Thanks in advance guys

Not sure how it will affect your benefits but a friend of mine got into bother for not declaring a few thousand! She wasn't working though so i'm sure that's different. Tax credits are usually really helpful if you phone them IME. I would ring them and tell them it may be happening and ask how it would affect you. It will depend on your dh's income etc. They won't do anything until you tell them you have the money.

I think you can have around £6000 in savings before they start taking it off your benefits.

I think savings above £6000 count against Housing and Council Tax benefit. The assumption is every £250 in savings above £6000 equates to an extra £1 a week in income (due to interest I guess.

ok......... but were not keeping it in savings, infact as soon as the cheque clears were paying off debts and putting some in the kids saving accounts which will leave us with probably about £2,000.

Do you think i should declare it even though technically we'll only have that amount for a few hours?

Thanks for the advise so far btw guys

Check before putting it in kids accounts as that can count as depriving yourself

I am not an expert but I think if the money is not sitting in an account, it isn't counted. Not sure about kids savings accounts.

ty olderandwider (like the name btw )
The kids ones are fine so im not worried about thier's.

tnx nymphadora i know the childrens accounts are fine

Even though you are spending it, it's still income isn't it?

It's like saying I only earn £200 a month because this is what's left when I've paid my bills therefore I shouldn't pay any tax.

Tread carefully, and make sure you are honest about what you have inherited.

I agree with 5ofus about treading carefully and being honest. IME in a situation like that it is the interest that they would take into account. I am very fortunate as my dad pays into an account specifically set up to pay some of our bills and the advisor told me that unless we earn over a certain amount of interest on that annually it didn't count.

Anything over £5,000 will impact on your benefits,but lets face it with £10,000 extra in the bank, Do you need the top ups for the min?

I wouldn't say a word, pay off your debts, put some in children's accounts and enjoy!

You need to declare it because you will have to pay tax on it. I'm not sure what type of tax though, inheritace, windfall or capital gains. If you don't you are comitting a crime.

You won't pay tax on £10,000 inheritance.

yes you should declare it and get proper advice - you could be seen as depriving yourself of income if you spend it all, even if it is clearing off debts. As even though the "sensible" thing is to pay off debts quickly to incur less interest etc, most debts have repayment plans attached to them so you don't need to (if that makes sense?).

Don't forget that once in a while you can be asked to take bank statements into your job centre meeting - and if one of those shows up £10k that came and went without a word you could end up in trouble.

I'd check on the kids accounts too. I think that if you have access to it then it's still classed as being available and "there".

I was fortunate with my DS's inheritance (3k each) from my granddad that it all went through my parents and put in a trust fund which they manage. I have absolutely no access to it all.

TBH the only way you MAY get around this is to get the payee to give you cheques made out to the debt companies. However, as far as benefits are concerned, if they find out, it is still 'income' and they may deem "you still have what you don't possess". They did this to me once and it took me 18 months to fight them over it (I sold my house and paid off a loan). Get advice pronto!

put the ten grand in a joint account with a parent or brother or sisters name. Then pay all your debts off. You wont have this chance again so go for it

My student loan affects my benefits entitlements (well, stops them). That's a repayable loan, busy gathering interest as I type. And that's not even over their 6k savings allowance. So I would guess that over twice that amount would change things dramatically.
Go to the CAB and see if it can be diverted directly into the debt repayment.

You definitely need to declare it. AFAIK the only 'windfall' amount you don't declare is a tax rebate, as obviously it's money that has already been assessed. Though I could be wrong if it's a very large amount.

It is income so has to be declared regardless of whether you keep it for a while or spend it within a few hours. Don;t risk fraud then have the possibility of being caught and face hefty repayments hanging over you for years to come.

Tax credits don't take capital/savings into account in the way that housing benefit does.

Instead you declare any miscellaneous income over £300 per year, which is where you would have to declare any dividends/interest etc on the money.

Hope this helps.

Oh, and you would have to declare the income in the year you received it, afaii, but best check with the tax credits helpline.