DS inheritance and UC

[Samantha08]

Hi looking for some advice. My DS's dad passed away a few years ago. I have been contacted by 4 of my DS's dad's pension providers, to say that DS is beneficiary. I have only had the amount from one pension provider which is around £16000. The other providers as yet have not confirmed amounts. I have had to set up child savings account in trust for the £16000 pound one, and I had to sign a trust document and get my sister to sign as they requested another trustee. The other pension providers have asked for it to be paid into an account in my son's name. My ds is 12 so when I set it up with the bank, they said to put it in trust in my son's name. So it's basically a child savers account in his name but in trust with me as a trustee. At the moment I claim UC, my son is autistic so most of UC payment is childcare as I work full time. DS is autistic so he needs childcare when I'm in work. I haven't had any payments yet for DS from the pension providers. But I'm worried UC will stop our money as they will treat it as my capital, I literally will not be able to work if I'm not entitled to childcare from UC. I'm aware this money is for my child, and have no intention of touching it. Is there a way UC will disregard this? Technically I could transfer money out of my son's account, but I would never do this as it's his. When my ds receives the money, surely I can prove to UC that my son's money is untouched, through bank statements. Sorry this is all very stressful for me, and I'm just very worried UC will stop when my ds gets payment from the pension companies.

If it's in an account in his name it won't be counted as capital for your UC, I looked into this recently as my son also received an inheritance and even a child saver account with you as Trustee (where you can withdraw) is fine as under the conditions of the account the money is his, not yours, and you cannot withdraw it to use for yourself, only for him. The key point is that the account is in his name.

It won’t affect your circumstances as an adult at all. You are a trustee only because you are the legally responsible adult, until DS comes of age. The money isn’t yours; it is not counted as part of your assets. It will affect DS’s own ability to claim income related benefits as an adult. Is he high functioning or likely to be living on PIP and disability benefits as an adult? If the latter it’s worth taking advice early, when he’s in his late teens, about what his financial plan should be for transition.

PIP will still be grand, it's not means tested.

This capital should be disregarded as the beneficial interest in the cash rests with your son and not you.

I would suggest you disclose it to UC together with the paperwork regarding the trusts upon which the cash is held. That way, if the trusts allow the cash to be accessed before DS is 18, say to fund activities through school, and money goes through your account you'll have a clear fallback if it's picked up on a UC review and questioned.