Page 9 | Inheritance protected so that benefits can still be claimed

JustACountryMusicGirlInCowboyBoots · 2023-10-04T08:01:17+00:00

Can inheritance of around £200,000 be somehow protected so that benefits can still be claimed if provision is made in a will to hold that inheritance in some kind of trust? The claimant will never work for various reasons.

PikachuChickenRice · 05/10/2023 21:46

Bluemink · 05/10/2023 21:07

I am glad there are a few sensible posters on here who understand the unfairness of a benefits system that decides if you have £16000 in Cash you are on your own regardless of what someones disabilities are. The issues here are relevant to many people with disabled children. The Ill informed or 'jealous' just see a lump sum of money without understanding the concept that £200K will not go far if a disabled person is unable to earn any money from work. In many cases if a disabled person inherits a family house they will have to sell it ending up with a lump Sum and a smaller house . The lump sum has to last them the rest of their lives or at least to Pension Age

I do not understand nor think it is fair that people for instance placed in the ESA Support Group should have their payments means tested. The payments in these cases should be for a persons disabilities, not just for a persons existence. So good luck to any Disabled Person who might inherit a house,which they will undoubtedly have to sell .

IMO the issue here isn't the cash cutoff it's the onerous process of re-applying.
Let's say they spend the 200K... they can't just 'go back' on benefits they have to do the process all over again.

Having said that there's a difference between assets and cash. If a disabled person has 200K that they can use to buy a house then that gives them more security. Unless they're in supported living paid for by the gov or have a secure tenancy living in rented accommodation is precarious, they could be kicked out at any time, same as a non-disabled person.

I also don't think means testing is a bad thing - say a millionaire's child inherited all their assets and was disabled - why should the state continue to support them? Of course I can see the slippery slope, what if it was 500K... 200K... etc. But my point is, morally, if they have independent means they shouldn't be supported.

The admin required to calculate of all this is immense though. Hence the blunt force 16K ruling which isn't always suitable.

Messyhair321 · 05/10/2023 23:38

JustACountryMusicGirlInCowboyBoots · 04/10/2023 09:14

That's what I thought too, it's crazy. The person is a carer for a disabled adult child but will be retirement age in 5 years. House is owned outright. I'd have thought the adult child's benefits would continue regardless of how much inheritance his dad gets so why would the dad need to keep claiming if he has £200k. I think he might have misunderstood what the solicitor said. He gets a pittance in benefits so why not use the inheritance?

So if the money is being given to the child its nothing to do with the dad, the money is for the child, if thats what you're saying? yes they should be able to keep the money, and benefits if the inheritance isn't actually for the dad

Solonge · 06/10/2023 00:04

No.

Justifiedcheese · 06/10/2023 00:08

Toomuchfun · 05/10/2023 19:05

I'm sure the accountants for the ultra rich would know how to do this but for middle/working class probably not. Get taxed making money and then taxed again spending it. If you save it you just get hit with 40% inheritance tax. If you think they will survive for 7 years they can gift money money now.
I mean someone who has worked and made £200,000 how could they possibly imagine getting help from the government after all the taxes they have paid.

Almost no-one pays inheritance tax FYI. The vast, vast majority of estates don't attract any. We paid zero on DMs Estate of over 700k

Tryingmybestadhd · 06/10/2023 00:09

Yes it can . Speak to a solicitor . I had to do it in my will in case something happens to me . My oldest has severe autism and will never be independent.

ToffeeMamma · 06/10/2023 00:57

No it can't, and shouldn't be ever allowed. People who need benefits for real need it more. Whether in trust or not if person has £6000 or more money will be deducted £16.000 or more and all income related benefits will stop.

Babyroobs · 06/10/2023 00:58

Toomuchtrouble4me · 05/10/2023 20:38

I think there is a way. My MIL inherited a very large house in Kent and she still claims benefits. Not sure which ones or how she does it, but I’m pretty sure that lots of home-owners are on benefits. So I should think if they buy a property or use it to renovate their own, they can still claim. Basically they prob need to spend it on something that won’t depreciate. Or invest in art? I’m not speaking from any experience or knowledge but I’m sure it can be done.

A house you live in is not counted for benefits purposes. If she had kept that inherited house as a second home then she would not be eligible to claim anything means tested.

Roslin168 · 06/10/2023 08:10

Is this a wind up???

Rosscameasdoody · 06/10/2023 10:17

PikachuChickenRice · 05/10/2023 21:46

IMO the issue here isn't the cash cutoff it's the onerous process of re-applying.
Let's say they spend the 200K... they can't just 'go back' on benefits they have to do the process all over again.

Having said that there's a difference between assets and cash. If a disabled person has 200K that they can use to buy a house then that gives them more security. Unless they're in supported living paid for by the gov or have a secure tenancy living in rented accommodation is precarious, they could be kicked out at any time, same as a non-disabled person.

I also don't think means testing is a bad thing - say a millionaire's child inherited all their assets and was disabled - why should the state continue to support them? Of course I can see the slippery slope, what if it was 500K... 200K... etc. But my point is, morally, if they have independent means they shouldn't be supported.

The admin required to calculate of all this is immense though. Hence the blunt force 16K ruling which isn't always suitable.

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I also don't think means testing is a bad thing

Means testing is a race to the bottom. The thresholds are set so low that a few ounces can make the difference to whether someone in real need gets help or not. Some previous posters have hit the nail on the head. It’s about need, and a disabled child unable to work inheriting property worth £200,000 is going to go through that money a lot faster than someone without the disability, who can work. The cost of living with substantial disability is huge and realistically £200,000 isn’t going to last a lifetime.

Rosscameasdoody · 06/10/2023 10:17

I also don't think means testing is a bad thing

Means testing is a race to the bottom. The thresholds are set so low that a few ounces can make the difference to whether someone in real need gets help or not. Some previous posters have hit the nail on the head. It’s about need, and a disabled child unable to work inheriting property worth £200,000 is going to go through that money a lot faster than someone without the disability, who can work. The cost of living with substantial disability is huge and realistically £200,000 isn’t going to last a lifetime.

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That should read pounds not ounces - bloody autocorrect !

Rosscameasdoody · 06/10/2023 10:20

ToffeeMamma · 06/10/2023 00:57

No it can't, and shouldn't be ever allowed. People who need benefits for real need it more. Whether in trust or not if person has £6000 or more money will be deducted £16.000 or more and all income related benefits will stop.

There should be some sort of allowance for benefits to be paid for a disabled person who is never going to be able to work. Living with substantial disability is costly and when they burn through their savings, they’re going to find themselves ineligible for contribution based benefits and having to rely on means tested. There should be a more flexible system with a bigger savings allowance according to need.

BooneyBeautiful · 06/10/2023 12:34

TeenDivided · 04/10/2023 11:30

I also don't want the stress of having to come off benefits then reapply for them all again a short time later.

I do think this is a key point in all of this. It is a lot of work to get things like PIP.

PIP isn't a means-tested benefit, so as long as you are eligible from a health condition point of view, you still receive it no matter how much your income or how much you have in the bank.

ToffeeMamma · 06/10/2023 14:34

I totally disagree I am long term disabled with a condition that will only get worse. I too will never work but I'd be more than happy to have an inheritance the system is designed so that those who can afford to live without benefits do so those who can't are able to apply. £16000 is more then enough savings if you are never going to be able to work. I wish I had that. I'd be more than happy for them 5o deduct it I had between £6000 and £16000 and if I had any more of course I'd expect it to stopped.

PikachuChickenRice · 06/10/2023 17:57

Rosscameasdoody · 06/10/2023 10:17

I also don't think means testing is a bad thing

Means testing is a race to the bottom. The thresholds are set so low that a few ounces can make the difference to whether someone in real need gets help or not. Some previous posters have hit the nail on the head. It’s about need, and a disabled child unable to work inheriting property worth £200,000 is going to go through that money a lot faster than someone without the disability, who can work. The cost of living with substantial disability is huge and realistically £200,000 isn’t going to last a lifetime.

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The issue with the thresholds is an implementation problem though - not an issue with means testing. I don't think the UK government will ever do it properly and the admin cost would be too much so practically, as I said in my earlier post, it is infeasible.

However morally I see nothing wrong with the concept. If someone inherited a million pounds. which is enough even for non-disabled people to never work again - why should they continue to be paid for by the state? Being able to work is irrelevant here.

Maybe this is just an academic argument though as the chances of this happening are very slim.

Rosscameasdoody · 06/10/2023 19:34

PikachuChickenRice · 06/10/2023 17:57

The issue with the thresholds is an implementation problem though - not an issue with means testing. I don't think the UK government will ever do it properly and the admin cost would be too much so practically, as I said in my earlier post, it is infeasible.

However morally I see nothing wrong with the concept. If someone inherited a million pounds. which is enough even for non-disabled people to never work again - why should they continue to be paid for by the state? Being able to work is irrelevant here.

Maybe this is just an academic argument though as the chances of this happening are very slim.

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You’re missing the point. Someone who inherits a million will always be ok because money makes money, so I agree. But someone who inherits just over the threshold will be forced to spend it before they get support. The thresholds are the problem - they are set intentionally to penalise anyone who is a few pounds over the threshold, even though they may be just as much in need as someone who falls just under it. Don’t think in millions think in hundreds or less. And in the case of someone who is too disabled to work, the money will be spent much faster, leaving them dependent on means tested benefits, which are cut to the bone.

Rosscameasdoody · 06/10/2023 19:37

ToffeeMamma · 06/10/2023 14:34

I totally disagree I am long term disabled with a condition that will only get worse. I too will never work but I'd be more than happy to have an inheritance the system is designed so that those who can afford to live without benefits do so those who can't are able to apply. £16000 is more then enough savings if you are never going to be able to work. I wish I had that. I'd be more than happy for them 5o deduct it I had between £6000 and £16000 and if I had any more of course I'd expect it to stopped.

Someone who is profoundly disabled is going to need a lot more than the current thresholds to be able to survive without benefits and the current system penalises those with savings until they spend below the threshold, which is set low. £16000 is a drop in the ocean if you can’t work.

MustWeDoThis · 06/10/2023 21:42

It would need to go to a Complex Decision Maker. Declare everything, provide every last piece of evidence you have and a written explanation etc. Only a DM can then tell you yes or no.

Obviously they are claiming which makes them vulnerable, especially with that large amount of money.

Oh! I just read about Carer's- PIP or DLA or ADP are not means tested. So long as the claimant is getting one of those than the Dad can still get C/A. If he gets UC then he can also get Carer's element on UC.

If they have Contributions based ESA, they can keep that. It's only IR benefits it will effect.

ToffeeMamma · 06/10/2023 21:46

I can't work, and £16000 is far from a drop in the Ocean. I've survived on much less than that when I haven't had benefits and had no choice about it and still been unable to work. Knowing how much fighting I had to do to get what I was entitled I fully understand why they make certain benefits savings restricted. There isn't an endless pot of money so it's only right that those who do have some money use this to support themselves. It's hard to save for those on benefits but at the end of the day there's a big difference between saving for an emergency and having £20 grand stashed away that could be funding your life. I'm sorry but I totally disagree, I require a lot of care needs and I'm aware that I'd have to fund carers, medicine and more if I had to come off benefits and have done before. It's not easy but the benefits system Sint there to provide a plush.life it's there to ensure those who do need it can gain it to survive.

Bluemink · 06/10/2023 23:15

I also don't think means testing is a bad thing - say a millionaire's child inherited all their assets and was disabled - why should the state continue to support them?

Talk about being born with the sins of your family !

Is a child of a Millionaire family not Disabled then. Its the disability of the individual person that counts not their background. The benefit should be in recognition of the disability, thus other income or assets should be a separate issue.

Bluemink · 06/10/2023 23:25

If that person had paid tax before their disability they should be judged as a individual and thus supported by the state for the disability . If the child received a large inheritance it is subject to the Tax Rules that apply.

However,a £200-300k scenario of a disabled child that has lived at home with their parents and on their parents death inherit a Mortgage free house is going to be a regular occurrence today.

PikachuChickenRice · 06/10/2023 23:26

Bluemink · 06/10/2023 23:15

I also don't think means testing is a bad thing - say a millionaire's child inherited all their assets and was disabled - why should the state continue to support them?

Talk about being born with the sins of your family !

Is a child of a Millionaire family not Disabled then. Its the disability of the individual person that counts not their background. The benefit should be in recognition of the disability, thus other income or assets should be a separate issue.

You're really saying that inheriting so much money.... beyond most people's wildest dreams.. is a 'sin' of the family? How dramatic. If that's a sin I'll have a generous dollop thanks. Where's my money?

Background is irrelevant it's what they actually have. If they were born into a rich family but did not inherit anything then obviously they are entitled to claim. In the same way, if they won the lottery then they have enough to support themselves.

Money is not given in 'recognition' of a disability as though it's some sort of medal. It is given to support the disabled person with the costs of their disability. Because, we are assuming that the disabled person cannot do this themselves.

If they can - then why should the state still pay?

And again... for the hard of reading, I will repeat I do not think in the UK this is practically feasible as what will happen now they will set the threshold so low.

But morally. There is nothing wrong with not wanting to pay. If someone can pay for themselves. The fact that 'oh they can't work' is irrelevant in the situation where they inherit so much money that they'll never have to. As in that case even a non-disabled person will never have to work and can live off it.

200K is NOT enough for a non-disabled person to 'stop work' so why would it be for the disabled to stop getting benefits. Fair enough. But not a larger amount.

FatandRoundBouncingontheGround · 06/10/2023 23:47

PikachuChickenRice · 06/10/2023 23:26

You're really saying that inheriting so much money.... beyond most people's wildest dreams.. is a 'sin' of the family? How dramatic. If that's a sin I'll have a generous dollop thanks. Where's my money?

Background is irrelevant it's what they actually have. If they were born into a rich family but did not inherit anything then obviously they are entitled to claim. In the same way, if they won the lottery then they have enough to support themselves.

Money is not given in 'recognition' of a disability as though it's some sort of medal. It is given to support the disabled person with the costs of their disability. Because, we are assuming that the disabled person cannot do this themselves.

If they can - then why should the state still pay?

And again... for the hard of reading, I will repeat I do not think in the UK this is practically feasible as what will happen now they will set the threshold so low.

But morally. There is nothing wrong with not wanting to pay. If someone can pay for themselves. The fact that 'oh they can't work' is irrelevant in the situation where they inherit so much money that they'll never have to. As in that case even a non-disabled person will never have to work and can live off it.

200K is NOT enough for a non-disabled person to 'stop work' so why would it be for the disabled to stop getting benefits. Fair enough. But not a larger amount.

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You aren't quite getting it.

As the parent of a disabled person, it's about who has the responsibility to look after that disabled person - not the money per se.

If you are assessed as needing care but having to pay for it, it is your responsibility to pay. If you don't pay, you don't get.

This is inequitable in as much as it fails to account for the fact that just because you are more wealthy, you aren't necessarily more competent.

My fear for my son is that, having set him up in the benefits system as he was unable to do that himself, if he loses that entitlement for paid-fir care, he doesn't have the ability to subsequently advocate for his own needs to reapply - or even to remember to pay, set up a direct debit yo pay for care etc.

There needs to be a much more intelligent analysis of people's needs (beyond competency as well - as a clever person you might say my son has competency, but as a profoundly autistic person he can't interact enough in order to fulfill that competency). That allocates some people as "obligate care needers" regardless of funding, or does a sort of PAYE debit, and that checks when a person's funds fall below the limit and automatically restarts paying them or something.

If that were in place I wouldn't mind him not getting money from the government, but I do very much mind people assuming that not needing money from the government means he doesn't need proactive care, even if he can't ask for it.

Owl55 · 07/10/2023 02:57

During probate you have to list any financial assets and their value , this information will be shared with many government and tax departments , if you are intending to not declare £200,000 you are committing fraud and have to repay your benefits and face fraud . You are being greedy !

Mcal · 07/10/2023 05:40

HongKongGarden · 04/10/2023 11:11

How on Earth do you get £9,600 from 6% on £200,000?

Even if you don’t “get” numbers, you must know that that’s not right.

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It's really not that hard to understand.

200k capital, 6% interest, gross interest 12k, tax rate with no discount 20%, total tax 2.4k, net return 9.6k per annum.

The poster you are criticizing is perfectly correct.

Not sure what "trading on interest" is about, but one can only hope it does not involve any financial calculation.

PikachuChickenRice · 07/10/2023 11:07

FatandRoundBouncingontheGround · 06/10/2023 23:47

You aren't quite getting it.

As the parent of a disabled person, it's about who has the responsibility to look after that disabled person - not the money per se.

If you are assessed as needing care but having to pay for it, it is your responsibility to pay. If you don't pay, you don't get.

This is inequitable in as much as it fails to account for the fact that just because you are more wealthy, you aren't necessarily more competent.

My fear for my son is that, having set him up in the benefits system as he was unable to do that himself, if he loses that entitlement for paid-fir care, he doesn't have the ability to subsequently advocate for his own needs to reapply - or even to remember to pay, set up a direct debit yo pay for care etc.

There needs to be a much more intelligent analysis of people's needs (beyond competency as well - as a clever person you might say my son has competency, but as a profoundly autistic person he can't interact enough in order to fulfill that competency). That allocates some people as "obligate care needers" regardless of funding, or does a sort of PAYE debit, and that checks when a person's funds fall below the limit and automatically restarts paying them or something.

If that were in place I wouldn't mind him not getting money from the government, but I do very much mind people assuming that not needing money from the government means he doesn't need proactive care, even if he can't ask for it.

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But I never assumed that. I will restate here, for the third time - I don't think this will be feasible to implement with this government. Please read, understand and acknowledge this.

What I am talking about, again for the third time, is the moral argument. Murdering babies is morally bad. Letting disabled people starve by giving them no benefits is morally bad.
Letting disabled people with the means use that money to pay for care is not morally bad. Provided that the threshold is sufficiently high. Even a 'check -in' that you stated is cheaper than paying them the full benefit and more importantly with that much money they can pay for a whole suite of other people to help them, with the state assisting with the arranging.

There are many possible configurations.