Query about insolvency and benefits

[PuzzlingRecluse]

Hi all

does anyone know if not claiming pay owed from insolvent company to keep universal credit & avoid cms payment is benefit fraud?

friends ex doing this at moment.

Thanks

Not sure about benefit aspect being fraud but DWP may regard unclaimed pay as notional income.

In my experience if you are employed by a that is insolvent and calls in administrators, receivers and ultimately a liquidator, you don't claim anything, the administrators/receivers sort it out as part of their job (your statutory redundancy will be paid by the Redundancy Payment Service, if there are not enough funds available.. You won't get everything you are owed, but will be put on the list of preferential creditors for the remainder. If you are self-employed and issue invoices to get paid you become an unsecured creditor and have to register a claim, you may eventually (years maybe) get a payment of a few pence for every pound owed. DWP would really only be interested when you receive a payment, but I think you would be expected to have invoiced / to invoice for everything if you were self-employed.

The amount of salary you can claim from an insolvent company is capped at a maximum of £719 per week for 8 weeks, so it might not be that they're not claiming, but that they can't claim everything. After that he'd be lumped in with the other unsecured creditors and unlikely to get anyhting.

What would he gain by deliberately not claiming? He's not going to be asked to hand over all his pay. Or am I missing something?