Inheritance for child when the parent is on benefits

[moneyisnotfunny]

Nc and some details changed for this. My young daughter is going to inherit around £30K from her late father once the estate is sorted out through probate. I am a single parent carer on benefits and am concerned about how to handle this situation. The money will be very much my daughter's and I have been told that it is to cover her maintenance up to when she reaches adulthood. Because it is maintenance, there needs to be a way of releasing the maintenance amount per month to me for her every day living expenses. If the full amount went into my account then my benefits would stop and the money would run out long before Dd hits 18 and we would because off as a family. I hope that makes sense.
How can I keep her money safe and in her name but released monthly to help for her day to day things? Is this possible? It's around £300 a month that she got and this is the rate it would continue at afaik. I will be asking for it to be paid into an account in her name. Multiple Junior ISAs? Premium Bonds? She is 8 and any account will have to be overseen by me as her only parent/guardian.
TIA.

Her father would have been contributing regularly one might presume.

I think the thread has moved on here but if it’s in trust she can’t use it for maintenance. It’s her daughter’s money.

Going back a few years now but I think it can be held in trust......I remember this happening to a girl I knew from school. Her and her siblings inherited a substantial sum of money, enough for her to buy a house outright when she turned 21.

Her mum was on benefits but it didn't affect them as it was held back for them.......the law may of changed in the 20plus years since that happened but as far as I'm aware it hasn't. You need to speak to a solicitor ASAP......you also need to make sure your dc is actually getting her fair share. And not her siblings version of it.

The money is not hers in what you are describing, if its in place of maintenance then maintenance does not belong to the child at any point.

The DWP automated scanning of bank accounts will pick up unusual activity and capital limit breaches so the best thing is to buy premium bonds with it. You can specify an account in her name for wins to be paid into, and you can cash in whatever amount you want when you want. If you don't need it then she will have a nice deposit for her own home at some point. Premium Bonds are tax free and so there's no issues with that also and you can hold up to £50k in them.

She's already said there is no Will. His relatives are responsible for sorting out his estate. They want to continue paying the maintenance to his child at the rate he was paying. This is the issue she has. Got it?

This is incorrect - and an appropriate route for OP and those due to inherit may be a Deed of Variation.

A Deed of Variation is a mechanism whereby a beneficiary under a will (or under the rules of intestacy) executes a Deed of Variation in favour of someone else. Effectively this means that new person named in the Deed of Variation is treated as the original beneficiary under the will (or rules of intestacy).

So rather than the money being passed to OP (and affecting benefits etc), the relevant beneficiary/beneficiaries execute a deed(s) of variation in favour of the DD. The share of the estate is then legally that of DD and not OP and so should not affect her benefits (TBC with specialist advisor).

Please don't advocate potentially fraudulent behaviour (hiding assets).

I meant they can't just unilaterally vary the rules, which is what they appear to be trying to do. Of course a DoV can be drawn up, if the adult beneficiaries want to give up some of their inheritance.

The child beneficiary CANNOT sign a DoV though.

The money won't be the OP's, so that's moot. She isn't a beneficiary under the intestacy rules.

And, for everyone at the back: THERE IS NO WILL.

@MyrtlethePurpleTurtle you would be correct if the DD wasn't a minor. She cannot consent to a deed of variation. Therefore her share can't be subject to one.

DD gets 1/3 of the estate (whether that includes house remains to be seen) held in trust for her until she is 18 and nobody may touch that money.

What's confusing people is that hypothetically (didn't happen here) someone can put a trust in their will that would allow for maintenance spending on the child while they grow up. This is entirely different & would not be able to happen here.

It's not that complicated, but OP is getting a lot of wrong advice & needs to speak to a solicitor. She could get an hour's session for under £300 (potentially free) and understand all of this perfectly.

I agree with this.

I think it’s either your income - which will affect the benefits you are entitled to.

Or it’s DDs income - which neither of you can touch until she’s a certain age.

I would work out how much better/worse off you would be if you had it put in DDs name vs yours.

I would be inclined to have it put in DDs name and have it not touched until she’s a certain age.
I think else you may lose a lot more in your own benefits.
It does mean losing the £300 a month which is a lot but if it’s put in your name you may lose a lot more.

The administrators of his estate can't just decide who gets what, and how.

Without a will, the law is extremely clear that ALL assets should be split equally between the legal beneficiaries:-

Ex-wife is on the make, unless she is on the house deeds. You need to stand up for your child, and not spend it yourself either in lieu of maintenence. This would be unethical and reportable to the court of probate. It should be ring fenced for HER:-

https://www.gov.uk/inherits-someone-dies-without-will

She cannot choose to put her DD's inheritance in her name. It's not hers!

If he’d intended it to go to op to help with her ongoing expenses, he’d have left it to op.
If it was left to the child, it belongs to the child, op can’t just dole it out to herself at all, never mind with the intention of defrauding the benefit system.

I can't afford a solicitor

I suspect you can't afford not to have one with the sums in play and the potential impact on your benefits

There is no impact on her benefits, as it's never going to be her money.

It's her DD's money, no ifs or buts.

Oh yes - 100% agree!

From what I understand the money is either in trust which means OP can't touch it. In which case it isn't taken into consideration for benefit entitlement. Or not in trust in which case OP can use it but it will be taken into consideration for benefit entitlement. As far as benefits entitlement goes I don't think the wishes of the late father are taken into consideration.

Then if it’s her money and not the daughters money she’ll have no entitlement to UC as she’ll have over 16k in savings

Having read your replies more thoroughly now OP, you need to make it clear to whoever is named on the Letters of Administration (like equivalent of an executor for those who die intestate - without a will) that as your child's legal guardian, you would like to receive a copy of the estate accounts of assets and liabilities, and how these are being split. If your child isn't receiving their full 3rd of her father's assets you can ask the probate registry to intervene. You do not need your own solicitor, but I would advise asserting yourself now, as it would be very easy for your daughter to be treated unfairly / fobbed off..

The reason she needs a solicitor is the £30k 'maintenance' vs one third of the estate (which OP is significantly more).

(Also if the siblings start to drip feed the 'maintenance' into OP's account and the. It will certainly muddy the benefit situation)

I've already said she needs a solicitor as the estate needs dividing as per the intestacy rules. Ages ago.

They can't drip feed something which doesn't exist (as in money called maintenance) into her account. The money they're 'kindly' offering isn't able to be just given. Intestacy rules apply.

OP I would call this number for advice on Monday:

Probate Call Centre
Telephone: 0300 303 0648

There is no "automated scanning" of the bank accounts of people on UC. The DWP can request bank statements from claimants and in some cases can obtain them directly from the financial organisation holding the funds. However, they can only do these things under certain circumstances eg a review or suspicion of fraudulent activity. The cannot and do not routinely access bank accounts just to check whenever they feel like it.

Op I understood what you wrote. Your dds father was already paying you around £300 a month in maintenance. I think a lot of people assume benefits are only given to those who don’t work etc. But they are given towards rent etc if you are a single parent. I would consider speaking to gingerbread single parent charity as they may be able to help. If the payments can carry on as normal until dd is 18. They can still go towards her upkeep. Basically you need to separate the money into two separate amounts. But maintence could possibly be set up as a monthly payment as that is how he paid you.