Inheritance and gifting

kayleigh988

Hi my mum stands to inherit some money from her Nan, but she is on esa. What she is wondering is because she stands to gift the money out to her children and it will leave her with less than 6000 after gifting, will her benefits still be stopped? Thank you 

poppy123456

If any part of her ESA is Income Related than any savings/capital of more than £16,000 will mean entitlement to all means tested benefits such as housing benefit will end.

Savings of more than £6,000 there's a £1/week deduction for every £250 or part thereof over that amount and up to £16,000.

For council Tax reduction some local Authorities have a maximum savings limit of £6,000 before entitlement ends.

I'm afraid giving away her money like this will be seen as deprivation of capital and she'll still be classed as having the money and all her benefits will still be affected.

Once the money goes into the bank she will need to report the changes to all benefits departments.

If any part of her ESA is contributions based this will not be affected.

Albus_Scope

Good morning @kayleigh988 how are you today?

I can see you're in excellent hands with Poppy answering your questions, but I just wanted to give you a big warm welcome to the community.  

poppy123456

poppy123456 said:

I'm afraid giving away her money like this will be seen as deprivation of capital and she'll still be classed as having the money and all her benefits will still be affected.

Just to add further to this because reading it again, it can be seen as misleading. Of course not all benefits are means tested. PIP/DLA/ADP/Tax Credits and contributions based/New style ESA/JSA are not affected by savings/capital.

kayleigh988

Thank you for your answer. I am just trying to help her as she is worrying about it. It’s not a lot of money but I just want to help her if that makes sense. 

poppy123456

Yes i understand but you said she will have less than £6,000 after gifting which indicates it will be more than £6,000 so she will need to report that once she receives it.