Insurance claim savings and more

dolphins7

Long winded post apologies 


When i was in work was a passengers and involved in a RTA 2021 took forever went on benefits due to recundancy in oct 2022 i have been awarded PIP HIGH RATE daily living UC and Lcwra

I was awarded 8000 pounds which has landed in my bank from RTA ins 

Owed my brother 1500 and paid of some other debts i have 5000 left so below 6000 8000 was in my account 2nds till i paid off my brother etc 

My house is being flattened and ill be moving soon so bought some stuff for new house relaced stuff that was old 

I also had backdated pip in april of 2500 which was spent quickly paid and closed credit cards with that 


My question is as i only have 5k do i have to declare the 8k comp even though i had it in my account a matter of minutes ?

Sorry for the long post 

Jimm_Alumni

You must tell the DWP if you receive a lump sum, even as compensation. You can explain it's you are no longer over the savings limit but you have to report the lump sum payments. Not doing so doesn't save you money in the long-term. Citizen's Advice explains in more detail  here Check how much Universal Credit you'll get - Citizens Advice.

There is a specific section in regard to if you go above £6000 in capital but spend it. I will put it in this post for you, so you don't have to trawl the above link to find it. 

Don’t get rid of your capital to try to increase your Universal Credit payments. If you do, the DWP will calculate your Universal Credit payments as if you still have the capital. This is called having ‘notional capital’.
The DWP won't treat you as still having notional capital if:
- they think you had a good reason for buying something
- you used it to pay off a debt you owe, including part of your mortgage
If you need help working out how your savings and capital affect your Universal Credit, you can talk to an advisor

I hope this information helps, I know it's not an easy system to navigate and it can be very frustrating.

poppy123456

I agree with Jimm and you must report this. Paying off debt when claiming UC is allowed and it won’t be seen as deprivation of capital.

However paying your brother back could see some issues unless you have proof that you owed him this money.

What counts for UC is what you have in savings on the last day of each assessment period. 

dolphins7

Hi 

Thank you i know UC is 6k but didnt know if i went by PIP limit yes it is a minefield so do i put the 8k as savings even though i dont have it all now or do I put the 5k i have left 

I received it 2 weeks ago and was only told by a friend i have to declare it my next payment of uc is already been calculated so i dont know what ive really to do 

Sorry for being a pest but ive not got a good grip on uc or anything for that matter 


My Ptsd is through the roof and have really googled everything and got myself in a state through it all 

dolphins7

@poppy123456

My brother lent me 6.5 k i paid most bk through working and redundancy i do have proof in my bank he gave me it but it was 2 years ago when working i paid him 300 per month then i was made redundant paid him a little more which left 1500 outstanding i paid him back the minute i got the 8k 

Im confused as to what ive to declare is it the 8 and let them decide or the 5k i have left 

dolphins7

I was given the 8k on 11th august my assesment period is 4th till 3rd 

poppy123456

You need to report the 8k you received and then tell them what you have left now. The assessment period where it will count will be 4th August to 3rd Sept. 

The lump sum you had for PIP is disregarded for 1 year. 

PIP isn’t affected by savings. However, if you have any PIP money left at the end of the period it’s paid for will be counted as savings for UC purposes. 

dolphins7

@poppy123456

I have already be assessed its due 10th my uc and lwrca which will go in my bank in 2 days 

God this is stressful will i get all my benefits taken off me 

dolphins7

@poppy123456

Its every week summit if the 2.5k isnt taken into account thats would be part of savings the 5k i have left or am i just presuming this 

poppy123456

If it was £8,000 from the insurance payout then this is what you need to report. I know you don’t have that amount left now but the £8,000 still needs to be reported. Just tell them where it came from and what debts you had to pay off. 

dolphins7

@poppy123456 doing it now this was for something long before i even went 9n benefits or was made refundant ins company forgot about it shocking i know and now more stress for me ive never had a month on benefits that they want something they wanted a years bank statments before lol now a month later want another statement maddness im so glad i have my dauggter to do all this 

Jimm_Alumni

Hi @dolphins7, I know this is really stressful. You just need to inform them that you got 8k and how much you have right now. If they ask where the difference went you can tell them the truth, you needed to pay off a debt and you needed to pay to move house which required necessary purchases. 

If you need help I recommend contacting your local citizen's advice and getting an adviser to help you through the process Contact us - Citizens Advice

Your PIP won't be affected at all as well.

dolphins7

Thank you jimm

poppy123456

If you're also claiming council tax reduction you should have also reported the changes to your local Authority. All local Authorites have their own rules for CTR and some have a maximum savings limit of £6,000 before entitlement ends.

dolphins7

@poppy123456 we dont have council tax its northern ireland but thanks 

dolphins7

Thank you all once again