Why does it work out better to have universal credit rather than using the chunk of cash?xxx

[Cloudy93]

I know this isn't really an AIBU, but I thought it might get more traffic here!

To cut a very long story short, I'm in the process of getting out of an abusive relationship, which has involved years of financial abuse and left me with very little savings. Since I left, I've been supported by charities and have been really lucky in securing a council house for me and my son and getting universal credit to top up my wages.

We are in the process of selling what was the family house. My ex husband (who has been difficult about every aspect of this separation, but especially the financial side, eg trying to get out of CMS payments) initially said we should split the profits of the house 70/30 to him. I have since had advice that I should be entitled to 50%.

My concern is that as soon as I receive these funds, he will report me to get my universal credit cut off. I have debts that I will be paying off with some of the house funds, but that will still leave me a little chunk of money. I would like to keep receiving universal credit because I only work part time. Would it be totally illegal/immoral to set up a bank account or trust fund for my son and put all the money in there for his future so I can continue receiving universal credit payments? What other options do I have?

Thank you so much in advance for all your help, happy to provide more info if needed.

Unfortunately you can't do that it would be considered deliberately getting rid of your capital. Your best best if you want to keep the money is to try and get it straight into another house purchase that you intend to live in. Are you eligible for a mortgage? If you are selling up and buying a new house with the money and can show UC then when you declare the savings they will give you a grace period for the purchase of the new house to go through. That way your money is protected and you can still claim UC. Bare in mind though you won't get housing payment for the mortgage like you would the rent.

Just curious but how would OP be able to buy a house and be approved for a mortgage if she's working part time hours and receiving UC?

UC is for people who are on a low income (so it is a top up) or have no other means to support themselves due to ill health or not having a job at that time.

It is not a way to support yourself so can keep savings. Like many PP have said, if you re going to use it for a house purchase, then it will be ok. If you are not going to use it for that, then you will be expected to live off if it until you meet the savings threshold for UC

I guess it would depend how much equity she has from the house as a deposit or whether she could buy shared ownership.

I would speak to citizens advice about it op. It depends on how much is left over after you’ve paid off debts etc if you’re allowed to still claim UC. If you can’t for a while then use what is left over to put your child in full time nursery or childminders so that you can work full time if that’s an option for you. When the savings are under 16k then UC pays you 85% of childcare costs.

Being a single parent may well limit her working full time.

@Spirallingdownwards no I mean people who are conveniently ignoring this woman is trying to escape an abusive relationship with a child. It's a step by step process to find your way out of that, and an awful situation to be in. If you can't be empathetic then just be factual. I also pay tax and frankly there are many ways it's wasted that greatly anger me (looking at you bojo and baroness bra), this isn't one of them.

I left an abusive relationship - including financial abuse - with DC so I know what I'm talking about. It's hard. But the law is the law and not declaring savings whilst claiming UC is fraud. OP has a roof over her and DC's heads and that counts for a lot. Her priority should be paying off debts anyway, and keeping up to £6k aside so she can carry on receiving UC.

It's not nasty to try and stop someone getting themselves into serious trouble by being dishonest.

If OP were to buy a home she would be eligible for less UC as she wouldn't get housing costs, so that probably doesn't make sense in the circumstances.

Surely the most important thing is to support your child while you work close enough to do that. If you are working too far away that you will need UC then it’s unsupportable.

Where are you planning on living? You’d be better putting the remaining equity into a property. Have a look at shared ownership too if you can’t afford to buy the traditional way.

True, but lots do it. I was just looking at earning more, so she could save some capital and not be reliant on benefits.

Why are people suggesting she buys a property when she’s recently got a council house?

They do yes. But if for example she can only work in a minimum wage job, and let’s say kids are at school, the wraparound care may well cost more than the extra she earns

OP, YOU are the one who asked whether your proposed actions are illegal or immoral. Why are you getting angry when the question is answered?
Your having debts to pay don't matter. As you asked about the money left over.
It's illegal/immoral to have other people pay your bills while you sit on thousands.

No wonder the UK is a mess everyone wants handouts.

No, sorry. The fact OP is trying to escape an abusive relationship does not mean benefit fraud is justified.

You literally asked if you could claim benefits????

"I would like to keep receiving universal credit because I only work part time. Would it be totally illegal/immoral to set up a bank account or trust fund for my son and put all the money in there for his future so I can continue receiving universal credit payments?"

So this is totally different from your OP.

if you intend to sell your house and use the money to pay off debts/money you owe to the point that the amount remaining will be below the threshold for UC, then you are perfectly fine to continue to get it, providing you are working the minimum number of hours required.

If, as per your OP you are intending to "hide" the house sale money and apply for benefits on top, this is fraud as per PPs.

Posters are making "nasty" remarks because you were suggesting you were intending to commit fraud. Now you seem to be back tracking.

This is a woman trying to escape an abusive relationship who will have a lump sum of money and help from family members, at least to the point that they will lend her money. She also has a council house and has had help from charities.

Whilst sympathising with her position, I don't think she is a priority to get extra money.

Record in your journal when you get the lump sum OP, you will probably have to close your claim at that point. However, if you're using it to pay off debts etc then that's not deprecation of capital I don't think. Discuss with UC and see what they say.
You can reclaim once you've done whatever you need to do with the money

Friend had to provide 3 years worth of receipts to prove where the money went and no they couldn't give chunks to their children's savings like they wanted a deliberately depriving themselves of assets

How much are your debts - how much would you have left of your lump sum from the house sale after you've paid off the debt?

YABU I'm afraid. I'm a UC claimant myself so I appreciate your position but I believe in honesty. I keep my savings below the amount of £6k for this reason. I think you will need to use your savings first.