Page 2 | Tax Credits and house ownership

BurntOutGirl · 2023-01-28T08:40:21+00:00

Hi. Hoping someone will be able to advise. My parents owned their house outright as Tenants in Common. My Dad died in 2013 and his 50% was shared between my sister and l (25% each). DH then left and we got divorced. Due to my low income l was awarded Tax Credits. I know that l will soon be made to move over to Universal Credits and this is where l am worried. My DS are currently 19 and 15yrs. The 19yr old has extra needs and is still in FT education as he has an EHCP. However from August -, when he turns 20yrs my benefits for him will cease. I will incease my hours but l can't go FT as he still needs input. From what l have read l will get Transitional Protection for the first year. My concern is after that. Am l correct that as l "own" 25% of my Mum's house l will not be entitled to any Universal credit help? Despite me not receiving any "rent" from my mum... afterall it is her house! Is it possible to sign my share over to my sister so l would be eligible for help?

titchy · 29/01/2023 11:46

Yes badly drafted, normally the surviving spouse has a lifetime interest in the property. Currently you could force a sale to get your half of the house. Sounds like the fact that she is of pensionable age means you'll still be able to claim UC though.

WednesdaysNameIsFullOfWoe · 29/01/2023 11:50

BurntOutGirl · 28/01/2023 08:46

Northampton.

From what l have read, UC assume that as l own a house l don't live in - l receive rent for it. ... which they then deduct from my award

Is it not that they view it as an asset (I.e. savings) which then excludes you from receiving UC?

WednesdaysNameIsFullOfWoe · 29/01/2023 11:51

BurntOutGirl · 28/01/2023 12:30

I have my own mortgaged property that l live in.

Would it still be classed as deprivation of assets if it's done over a year before l go onto UC?

The inherited house can not be sold as my Mum still lives there

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She could buy you out of your 25%. You are not allowed to sign it over to someone else in order to get benefits.

Mirroredlove · 29/01/2023 11:53

Why would your dad leave it to his kids and not his wife? That’s how it goes normally, partner then kids once they die.

Is she your maternal mum?

titchy · 29/01/2023 12:28

Mirroredlove · 29/01/2023 11:53

Why would your dad leave it to his kids and not his wife? That’s how it goes normally, partner then kids once they die.

Is she your maternal mum?

A) to avoid the situation where the surviving partner goes into care and the entire value of the house pays for care home fees. B) to avoid the surviving partner remarrying and the new spouse getting all the house. Leaving 50% of the house at least ensures that the children inherit.

Original poster

BurntOutGirl · 29/01/2023 12:31

Mirroredlove · 29/01/2023 10:23

Her own share will be used for care needs, your dads share can’t be used as it’s not hers.

Suppose she is lucky she has nice kids really and was a good mum otherwise sounds like she could be homeless tomorrow, the whole house is not hers.

We would never do that to our Mum. If need be we would give "our" half of the house proceeds to her for Mum to use. She would of course refuse it... and we'd insist... and would go round in circles till l get my way (I'm the youngest so always get my way 🤣😏)

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Original poster

BurntOutGirl · 29/01/2023 12:32

titchy · 29/01/2023 11:46

Yes badly drafted, normally the surviving spouse has a lifetime interest in the property. Currently you could force a sale to get your half of the house. Sounds like the fact that she is of pensionable age means you'll still be able to claim UC though.

Yes, she is 76yrs currently

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Original poster

BurntOutGirl · 29/01/2023 12:36

titchy · 29/01/2023 12:28

A) to avoid the situation where the surviving partner goes into care and the entire value of the house pays for care home fees. B) to avoid the surviving partner remarrying and the new spouse getting all the house. Leaving 50% of the house at least ensures that the children inherit.

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It was A. Although it's a mute point though as my sister and l don't class it as our money anyway, and would let Mum use all of the house equity on herself if needed

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NotABeliever · 29/01/2023 12:48

Apologisies for not reading the full thread.
The value of your second house or share of it will be taken into account for UC and make you ineligible. However, you will not be asked to move to UC for a long time still. We've been advised the planned migration has been pushed back further. So chances are, it won't happen before your youngest is 20 and you'll thus be able to stay on Tax Credits. Be ware of any changes of circumstances that would trigger a move to UC such as a new partner.

titchy · 29/01/2023 13:31

NotABeliever · 29/01/2023 12:48

Apologisies for not reading the full thread.
The value of your second house or share of it will be taken into account for UC and make you ineligible. However, you will not be asked to move to UC for a long time still. We've been advised the planned migration has been pushed back further. So chances are, it won't happen before your youngest is 20 and you'll thus be able to stay on Tax Credits. Be ware of any changes of circumstances that would trigger a move to UC such as a new partner.

Someone has already posted the regulation that states the second home would be disregarded as it's occupied by a relative of pensionable age.

GordonShakespearedoesChristmas · 29/01/2023 13:46

Can't quote an already quoted post, but OP it's the rules; of course they'll abide by it! They don't sit there and think " oh I'll just ignore the rules here!"

Original poster

BurntOutGirl · 29/01/2023 14:04

NotABeliever · 29/01/2023 12:48

Apologisies for not reading the full thread.
The value of your second house or share of it will be taken into account for UC and make you ineligible. However, you will not be asked to move to UC for a long time still. We've been advised the planned migration has been pushed back further. So chances are, it won't happen before your youngest is 20 and you'll thus be able to stay on Tax Credits. Be ware of any changes of circumstances that would trigger a move to UC such as a new partner.

The current information on the Internet is that everyone will be Transitioned over by 2024.

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NotABeliever · 29/01/2023 18:13

It's unlikely to happen in 2024. It will be postponed again. They will first start moving the straightforward claims, no children or limited capability for work, caring responsibilities etc.

Original poster

BurntOutGirl · 29/01/2023 22:59

NotABeliever · 29/01/2023 18:13

It's unlikely to happen in 2024. It will be postponed again. They will first start moving the straightforward claims, no children or limited capability for work, caring responsibilities etc.

Just found this. Was only published this month.

As part of that plan, in 2023/24 we plan to move cases that are solely in receipt of working tax credit and/or child tax credit, with the remaining tax credit cases (which also receive DWP benefits) and IS, HB and JSA in 2024/25. In the early part of 2023/24, we will be testing our ability to scale the approach that has been developed during Discovery and we will continue to learn and refine the process to ensure as many claimants as possible safely transition to UC.

I am solely in receipt of WTC and CTC...

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