ESA, UC, CT reduction with a lump sum due to injury

greatscott83

Hello everyone, hoping you can offer some guidance if been through a similar thing.

I had a car crash in 2017 that left me registered disabled, I get enhanced PIP on both elements, contributions ESA support group and limited capability on UC, 100% discount on council tax. 

I've had a critical illness payout for my mortgage of 6 figures, now this could clear my mortgage, and have a couple of grand left to enjoy, but I've also had an opportunity to try and create some additional income and a pension down the line with buying a flat to rent out I can buy outright with cash.

I know I would lose UC and I'm thinking I would lose the council tax discount as well but I'm unsure. 

if I purchase a flat and rent out on my current benefits what will I lose? im likely to lose UC and council tax reductions, but will I lose contributions ESA? and I have a 17 yr old kid who lives with me (moved in last week)  would I lose any support for him also? (child element of UC) Currently, I don't get anything for him including child benefits as he's moved in literally last week long term. 

do I pay off my mortgage and live an easy mortgage-free life and continue to claim all im eligible to or try and use this money to set myself up and step away from benefits and maybe make myself a future in the landlord game?

any advice is welcomed.... im really stressed with it all as I think im risking a lot of benefits but im in a really good situation, but this money is a headache and id rather not have it in one sense. 

many thanks and be great to hear back from someone

poppy123456

You can pay off your mortgage with the lump sum and it will not affect any of your UC. Not sure about your council tax reduction and for this you'll need to speak to your lcoal Authority. If you're left with savings of less than £6,000 then this is ignored. For every £250 or part there of over £6,000 there's a £4.35/week deduction in your UC.

CTR savings limit maybe different because some local Authorities have a maximum savings limit of £6,000.

If you bought a property and rented it out then your UC will end as well as your CTR. If your son is still in full time education then any money for him will be included in your UC (apart from child benefit) so if your UC ends you will not receive any additional money for your son other than child benefit.

Your ESA isn't means tested so this won't be affected.

Please also take some time to have a think about this because being a landlord isn't the easiest thing in the world. You'll also need to consider any future repairs to the property as well as everything else included whilst being a landlord.