Mum received inheritance but is on ESA & PIP

[FullofSurprises]

I need some help regarding inheritance and wondering if someone can point me in the right direction.
My mum has come into inheritance after her lifelong partner passed away and left her in his will.
She has long term illnesses and has been on ESA and PIP for quite some time.

Originally she wanted to just gift me the money as she did not want to lose her benefits but we've found out today it's not as simple as that, and that even she were to give the money away she would still be classed as having the money.

How can this be right? She never asked to be on his will and I know she would never have accepted this had she of known this would be the outcome.
She is worried now and really doesn't know what to do.
Does anybody know a way around this?

I think she can stay on ESA but just will not receive any money. SOrry I am not well enough to help more

Maybe try the Rethink helpline? or local Rethink or Mind group for benefits advice. CAB are sometimes helpful but it depends on having local expertise - better in big towns and cities often. . Age UK might be able to help

hope it all works out - whatevr you do do not close the claim

I mean do not close the claim at least until you have taken lots of advice!

You can have a credits only claim due to having too much income

@AnotherEmma she's in the support group, I don't suppose you know if that is income related? She gets the severe disability premium too.

Support group and work-related activity group (WRAG) are categories that are based on the level of disability ie support group are not expected to work at all, whereas WRAG may be expected to attend some appointments and make some progress towards being able to do some kind of work. You are in either one or the other.

Contributory v income-based is completely different and it's how you qualify for ESA (whether you have enough NI contributions or have income/savings under the threshold). Some people can qualify for both ie they get some cESA and then a top-up which is ibESA.

There is a slightly strange quirk which is that someone in the support group on cESA can continue receiving it indefinitely. Whereas if you are in the WRAG on cESA you would only get it for 1 year. After that it would stop unless you also qualified for ibESA. As your mum is in the support group it is possible that she could be on cESA, if she qualified when she first claimed ESA (which would have depended on her NI record).

PS The fact that she gets the SDP indicates that she is on income-based ESA but she might be getting that by itself or in addition to contributory ESA.

Ok thanks. I think I'm understanding this a bit more now. It's very complex isn't it!

She clearly doesn’t need the money now

Why would you resent supporting yourself if you were able?

Don’t get this at all.

Because surely it’s irrelevant to her where her money comes from? Or is it harder to get back on their books once the cash is gone?

@KrabbyPatties she's on an old style ESA for severe disabilities and she can never work because of her condition. She won't be able to reclaim ESA once she comes off it. I hope that makes sense.

I was a legal professional and a vast amount of the ‘legal advice’ given on mumsnet is wrong, please consult a solicitor. They are no where near as costly as you think, you’ll want to speak to a private client solicitor. It is possible to create a trust after the death of the testator (person who has made the Will) but you’ll need a savvy solicitor to help.

You should be able to phone and outline the situation. Even better if you choose the solicitors who will be dealing with the probate of the estate.

Best of luck.

I'm imagining that, if she is on PIP, ESA, SDP and in subsidised housing then her income isn't very much at the moment. If you put the inheritance into one account and set up a standing order to create an "income" then it doesn't have to be as low as the benefits - so perhaps you could add a positive spin to the situation by pointing out that she can now have a better standard of living?

Also when considering an eventual re-claim for ESA, don't forget that this can start once the savings deplete to £16k; she doesn't have to get all the way down to zero savings before submitting that claim.

By "eventual re-claim for ESA" I mean for UC on the basis of being unable to work due to disability, so whatever element of UC that is.

@BloodyCreateUsername

I was a legal professional and a vast amount of the ‘legal advice’ given on mumsnet is wrong, please consult a solicitor. They are no where near as costly as you think, you’ll want to speak to a private client solicitor. It is possible to create a trust after the death of the testator (person who has made the Will) but you’ll need a savvy solicitor to help.

You should be able to phone and outline the situation. Even better if you choose the solicitors who will be dealing with the probate of the estate.

Best of luck.

obviously you know the law about setting up trusts, but how does that relate to the benefits claim; would that not be seen as alienation of assets.

No advice OP, but lots of sympathy for your mum and lots of respect for you for looking out for her. It’s just crazy how complicated the ‘benefits’ system is. I hope things work out for your Mum. It would be good if you could find somewhere better for her to live.

Good luck.

Hello everyone I am back!

Things have now taken a weird turn.
Now it transpires that his pensions in the sum of around £80k have a clause that basically overwrites any will that was done.
Around £18k of this has been automatically nominated to my mum as she is seen as his long term partner.
However, they're asking her to now fill a form out for the other £58k as they believe his parents might possibly be alive and so it would come down to either her inheriting it or them (we don't actually think they're alive though as they would be in their 90's if that was the case)
My mum has to fill the form in, it's been sent to her.

She can request to either have the money paid to her in one lump sum- this would obviously mean she would need to declare and stop her ESA.
The other option is to have it paid as a monthly long term payment, I think it's called an annuity? Now I don't know if this option would protect her ESA we haven't spoken to anyone official about this yet.

The other option is that she won't be nominated for the £58k and she'll only receive the £18k and then I suppose if she can somehow justify using £2k of that, she can reapply for the severe disability premium within the month period that she has after stopping ESA.

Does anybody know about annuity's for pensions?

Oh and also it turns out his life insurance is invalid so that's made the amount even less than we thought!

You need to speak to someone with specific knowledge of benefits and inheritance, not any high street financial advisor - but it's possible to have a trust which does not affect benefits - dp's will is set up this way for his disabled dd. The problem is that even a modest standard annuity will trigger a change to universal credit as it's a change in circumstances. A specialist advisor again can help you navigate it the best possible.

No one can advise you further here because we simply don't have enough information.

You still haven't said whether your mother's ESA is contributory or income-based. Almost everything hinges on that.

If (and only if) it turns out it's income-based, then you may also want to consider your mother's age and how close she is to receiving a an old-age pension rather than ESA, which is a working-age benefit. That may help you decide whether attempting to remain eligible for ESA is worthwhile or whether she only has a few years to cover to the pension. You would also need to bear in mind that if she continues a claim for income-based ESA, even though not receiving any money from it, she may continue to be credited with National Insurance contributions towards her pension (unless this has changed since I last looked, which it might have). So it may be beneficial for her future pension, for her to stay "on" income-based ESA while receiving zero payments.

But honestly, no one can tell you much more because you haven't told us enough.

YOU NEED TO GET PROPER ADVICE, TAKING ALONG ALL THE DOCUMENTATION.

@PerkingFaintly the answer is I don't know, because my mum still hasn't bothered to check. Sorry but she does have schizophrenia and part of having that means she isn't motivated enough to bother to do things most of the time.
And that's fine, if no one can advise here I'll end the thread here so you can be on your way, sorry to have inconvenienced yourself so much.
I'm already stressed enough with this.

Sorry you're so stressed, FullofSurprises.

I know it's really rough. It's rotten that this devolves on you because (naturally) your mother can't manage, and very difficult for you when you're trying to help but can't get at the information.

Lots and lots of luck in sorting something out.

[quote FullofSurprises]@PerkingFaintly the answer is I don't know, because my mum still hasn't bothered to check. Sorry but she does have schizophrenia and part of having that means she isn't motivated enough to bother to do things most of the time.
And that's fine, if no one can advise here I'll end the thread here so you can be on your way, sorry to have inconvenienced yourself so much.
I'm already stressed enough with this.[/quote]
Op does your Mom have any debt? Any rent arrears? That would be considered a reasonable expenditure for bringing it down to under 16k.

With the annuity its also worth finding out what happens if he dies before the money is paid in totality.

Dwp operative here 🤫... agree with all others.

ESA contribution based - capital not relevant.

ESA income based - capital and annuity income relevant.

PIP - never relevant..

@Joeblack066

Why is her not claiming ESA till the money runs out a problem? Why would you want to get round it? She keeps the PIP, she lives off the inheritance till it gets to the allowed amount and goes back on ESA. What’s the problem?

Have you read the thread? She won’t even have freedom to spend her own money as she chooses, DWP can deem what is ‘necessary’ or not. And she won’t be able to reclaim ESA she’ll have to claim UC.

Originally she wanted to just gift me the money as she did not want to lose her benefits
so basically she doesn't want to use those thousands of pounds paying for herself???
she can always apply for ESA again once her 'inheritance' runs out.

@monkeymonkey2010 no she can't. If you'd actually read the thread properly you'd of seen that. It doesn't matter now anyway, she had a massive breakdown with the stress of it all and was sectioned and now she's caught covid whilst on the ward and is on oxygen.
I swear to god it's like people hate disabled people actually having any kind of income from the government. Do you even understand how much stress and pressure it is for someone with a severe mental illness to have to reclaim everything all over again? Especially when they don't have the capacity to? Of course you don't.