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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Can I ask a quick benefits question if anyone can help?

51 replies

NotUmbongoUnchained · 11/03/2018 19:46

A family member has sadly passed and some inheritance is being split between us all, 10K each. My little sister is currently a student and claiming housing benefit and child tax credit.
Does anyone know how this will effect her or if it is under the threshold of the savings limit. I have looked on google but it mainly seems to be advice for pensioners and the benefits calculator doesn’t work for students. She would like to save the 10K into an account to save for a deposit on a house ideally for her and her daughter for a bit of security while she is studying.
Any advice would be much appreciated as she is stressing a bit about it and what to do. Thankyou.

OP posts:
Whatshallidonowpeople · 11/03/2018 19:47

Just declare It and see if it makes a difference.

SmashedMug · 11/03/2018 19:49

It will affect her benefits. The threshold is £6000 I think but under that it can still affect benefits on a sliding scale.

FriendOrFwend · 11/03/2018 19:51

It will 100% stop her HB, anything over £6000 in savings will make her ineligible. Not sure about everything else though

lalalalyra · 11/03/2018 19:55

Tax credits don't count the actual savings, they count the amount of income on the savings.

Housing Benefit under between £6000 and £16000 will reduce her award. She'll be able to look up the exact rules for the amount.

She won't be able to save the whole £10,000 most likely. Over £6000 she'll have her HB reduced.

butterfly56 · 11/03/2018 19:56

For Housing Benefit she will have to notify them of the inheritance and it comes under the upper threshold of £16K so she can still claim HB although they will take the money into account when calculating HB entitlement.
No idea about child tax credit so cannot offer any advice on that.

Original poster
NotUmbongoUnchained · 11/03/2018 19:57

Thankyou everyone

OP posts:
Springiscoming123 · 11/03/2018 19:59

It will 100% stop her HB, anything over £6000 in savings will make her ineligible. Not sure about everything else though

as usual someone giving in correct advice

if you dont know 100% pleased dont post

PearlyG8 · 11/03/2018 19:59

If the money is being split perhaps her share can reasonably be split between her and her child? Obviously you/she need proper legal advice to do anything like this.

pinkyredrose · 11/03/2018 20:00

Friend it wont stop her Housing Benefit Hmm it'll reduce it that's all.

OP maybe she could put some of it in a bond, it might not affect it. How can she get housing benefit though, i thought students couldnt claim?

Original poster
NotUmbongoUnchained · 11/03/2018 20:05

pinky

She has a young child, so she is still entitled to housing benefit, although it was slightly reduced when she started.

OP posts:
MorningCuppa · 11/03/2018 20:05

She can't put some into savings account for her child, my friend done this and it is allowed!

MotherforkingShirtballs · 11/03/2018 20:09

Her HB will reduce, it's a sliding scale so they'll let her know how much by.

Tax Credits only take into account any interest on the money and even then the first £300 of interest will be disregarded.

If she gets means-tested student loans I'm not sure if they'll take the money into account.

TryptoFan · 11/03/2018 20:10

Could you look after it?

Original poster
NotUmbongoUnchained · 11/03/2018 20:15

trypto absolutely! But I’m not sure if that’s fraud haha. I don’t want to be done for that.

OP posts:
darkriver198868 · 11/03/2018 20:51

You can save up to £6000 without it affecting your benefits. After that they take off £1 for every £250. Once she reaches £16K she isnt eligible for any benefits except tax credits. Personally I wouldnt hide it.

darkriver198868 · 11/03/2018 20:54

Claimants under State Pension age
The first £6,000 of savings and investments value is not taken into account when calculating HB or CTS. If you are in a residential home this increases to £10,000.

We will include a tariff income of £1 for every £250 of savings and investments above this amount (up to a limit of £16,000). If you have more than £16,000 you will not be entitled to HB or CTS.

Domino20 · 11/03/2018 20:57

Put into savings in her childs name.

MyDcAreMarvel · 11/03/2018 20:59

All that will happen is her hb will be reduced by £16 a week. Nothing will happen to tax credits.

LakieLady · 11/03/2018 21:01

Domino, that's really bad advice. If you give away capital, or blow it on extravagant stuff, you can be treated as though you still have it for benefit purposes. And trying to "hide" it could be treated as fraud.

couldnteatawholeone · 11/03/2018 21:02

Get her to the CAB.
Over 6k has an affect on housing ben, any income related bens and tax credits work slightly differently.
If she spends to get to 6k or below it can be considered "willful deprivation of capital" leading to "notional capital" where u r treated as still having the money....even if you spent it. Meaning your bens are still affected
So see a benefits adviser face to fave, get the ins and outs in writing and then can make sensible decisions.
Don't hide it or spend it willynilly....it will come back to haunt her and it is benefit fraud.

MyDcAreMarvel · 11/03/2018 21:04

She doesn't need cab it really is as simple as £16 reduction in housing benefit. That is it.

pinkyredrose · 11/03/2018 21:13

She could invest it buying art, antiques or wine? Then sell in a few yrs?

Magpiemagpie · 11/03/2018 21:32

I think for every £250 over £6000 £1 is taken of her benefit
So she will lose roughly £16 from HB

Voice0fReason · 11/03/2018 21:37

Whilst she can't just give it away, she could do something like buy a car.

Voice0fReason · 11/03/2018 21:45

People are talking about £16 per week like it's nothing. It's an extra £70 per month. That's a lot for many people.

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