To think sister needs to declare inheritance

[CanIhavedessertfirst]

Ok, this is a bit of a looooong story, so bare with me.

My sister lost her dad in November (we have different dads) and inherited £27,000. He had a council property and she has now acquired the tenancy and, as it was her father's home, she wants to say there for the foreseeable and I think it's most definitely the security she needs.

We have now lost our grandparents and are both set to inherit a sum of money each, adding to the capital she will have.

My sister receives esa and also housing and council tax benefits, she has always lived at home and never had such a large amount of money. She is by no means stupid, she is very careful with budgeting and saving, but I think she's being a tad naive in this situation.

I met with her today and she said her step mum (also received £27,000) has been spending her share so that she doesn't have to declare it to the dwp (am I wrong in thinking they will find out eventually?). My sister hasn't spent her share (she's a little more savvy) but hasn't told the dwp she has come into money. Today the tenancy was signed over to her and the housing association are aware her dad has passed away. She said she had to show bank statements, etc.

I worry she has done the wrong thing and she is going to end up in trouble. We have only just started speaking again, after almost a year (family stresses and shit) and neither of us speak to my mum, so basically I am the only family she has left. I don't know what to do, because I feel like I'm not in any position to tell her what to do (she's 26) but equally I know this probably counts as fraud. She says her dad and his solicitor were clever and that may be true, but she's my little sister and I worry.

Can anyone give me some advice? My husband thinks I should mind my own business and let her deal with any fall out, but I don't want to let her down by knowingly letting her get into shit.

If she is savvy as you say, then mind your business.

@DewDropsonKittens she's savvy with money, but not with "the system", hence my concern.

Let her deal with it. Don't get involved. If it goes wrong, then so be it.

She needs to find out for herself. Let her face the consequences

@PoisonousSmurf this was the exact advice my husband gave!

@DewDropsonKittens my biggest worry is that they will take her tenancy from her, but - as you say - that's her consequence, should that happen as a result. It's so hard to look at it with a neutral mind when I can see it from the right and wrong pov, AND it being my sister.

If she receives contributions based ESA then savings don't matter. Housing benefit is another story.

Could you not ask her to double check. Just in a "You see so many horror stories of people getting caught out because they don't realise and accidentally get in trouble" worried way rather than a "don't fiddle the system" way.

I think of her father had a solicitor then she had someone guiding her. Unless you really understandthe particulars of the bequest,you may just be causing trouble.

I know I'd be a bit envious if that happened. She gets the house and the cash!

You are not worried, you are jealous.

It's very spiteful to report her.

Being a financial adviser I would say that she needs to declare it to the DWP. They will find out at some point & when they do she will have to pay back any payments that she shouldn't have got. If that is 2 or 3 years down the line & she had happened to have spent her Inheritance she will be up s**t creek.

I think you are right to mention it to her but you can't do much more & your conscious will be clear.

She’s your sister, there’s absolutely nothing wrong with you giving her advice, so do just that. Advise her. If she doesn’t take your advice, at least you’ve tried, and she can deal with the fallout herself xxx

I’d keep out of it like poison said, it’s nice to that we can save people from their potential mistakes but I’m not sure I’ve ever seen a single example of someone being saved by advice when they think they’re right.

I assume she had to go through probate.
We did when my dad passed.
Probate automatically inform DWP and council ect.
So she'll be found out sooner or later.

She does have to declare it. Not declaring it means she will be claiming benefits fraudulently. She can be prosecuted for fraud and depending on the amount of fraud it could end up with a prison sentence. She is denying people who really need the money from getting it. This kind of behaviour makes me angry.

@lalalalyra I told her today to just put the money in her savings and research all the ins and outs of inheritance while on benefits. I don't want to advise her too hard because I don't want to fall out again.

@LittleFeileFooFoo all I said to her today was to research everything. I can't say I really feel envious, as she has lost her dad. Having lost my grandparents, who brought me up, I think inheritence leaves a bitter taste really.

@petbear where did I say I was going to report her? You haven't actually read what I have written at all

When I received inheritance I was paid via the solicitor who had already paid the government what was owed and then he transferred the rest to me, Also my dad set up a trust to avoid as much tax as possible,maybe this us what your sister means by " being clever" who knows? but if I was you ( and seeing as your relationship with her is wobbly) I'd make one last attempt to have a conversation about your concerns and then leave it alone.

@hadthesnip (fab name) I told her to do her research, as I feel like she will get pros and cons and it's from people who have been in her situation. I over think so my head always goes to the whole 5 years from now, whereas she is more spontaneous and in the moment.

She needs to tell them because if you get means tested benefits then these stop after you have £16,000. If she continues to claim then she will have to pay it all back and risk getting prosecuted for benefit fraud.
The DWP do scans of interest shown in banks accounts and the HMRC is linked in as well.

If she's got legal advice, leave it up to her to accept it or not. Frankly, given the disgraceful way benefits are randomly cut/sanctioned/held down, and the fact that MPs routinely fiddle the taxpayer out of far, far more money than this, I'd wish her luck with the money.

It depends what type of ESA she is on .if it is contributions based then any savings won't affect it , but if it's income based she will lose it until the savings drop below 16k. Likewise she will lose her HB and Council tax reduction. there is no point trying to spend it or hide it as the DWP will find out and she would be treated as if she still had the money. I think there are certain things she would be allowed to reasonably spend it on like debts but it is not possible just to fritter it away to continue getting benefits when she doesn't need them.

She should perhaps also take a look at the deprivation of capital rules.

@Awwlookatmybabyspider she is joint executor with her step mum. I don't really know what that means. Tbh I don't even know what probate means, but she did mention it today.

@mrsBeverleyGoldberg @Nofunkingworriesmate I thought about telling her to speak to my uncle, who is executor of our grandparents' will, as I thought maybe he could talk her through it better.

It sounds like you’ve got her interests at heart and you’ve done your best. You could try again and iff you do I think the ‘so many people get caught out’ angle is a good one. But in the end once you’ve tried to tell her and she doesn’t want to hear then there’s nothing more you can do really. Don’t feel bad. It’s not your fault.

@ReanimatedSGB you're bloody right there!