What happens with ESA on inheriting cash to buy a home?

clothears

I am currently in receipt of benefits, including income-related ESA Support Group, Housing Benefit, Council Tax exemption and PIP. I am 55. I live in a Council flat. 

My parents are divorced and in their eighties. Assuming one parent will die before the other, when this happens, I will inherit enough to buy a flat, just about. There will be a short period when the inheritance will be in the form of cash, between receiving the inheritance and me finding and buying a home, after which I expect not to have much in the way of savings. I understand I will lose Housing Benefit and Council Tax benefit permanently, but will I also lose ESA, either temporarily before I spend the inheritance on a home, or permanently because the home will be worth over £16K? I have read on this website that the home you live in is not considered part of your savings, but I want to make sure this is accurate, and I also hope to avoid being taken off ESA for several weeks/months and have to go through the process of re-applying for it. Thank you.

poppy123456

Once the money goes into your bank account you will need to report the changes for all means tested benefits. 

If any part of your ESA is contributions based then this will continue. Any Income Related will stop. 

If your ESA is part contributions based then you will be able to contact ESA once the savings go below £16,000 and then claim the Income Related top up again. 

If all your ESA is Income Related then you will need to claim Universal Credit once savings go below £16,000. 

It may take quite sometime to find a property to buy, even if a mortgage isn’t needed. It’s unlikely to be a fast process. 

clothears

Thank you very much for your prompt and clear reply, Poppy123456. I hear Universal Credit is more problematic than ESA. Do you know what they mean by this?

poppy123456

It's not perfect and It does have its bad points but the majority of people claim it without any issues. I manage my daughters claim as her appointee and never had any problems.

If all your ESA claim is Income Related then you need to make sure that your NI credits will continue based on limited capability for work. Then when you come to claim UC, assuming you're in the Support Group for ESA then you'll be entitled to the LCWRA element from the start of your claim. You will not need to go through another work capability assessment.

clothears

Yes, I am in the Support Group. Thank you so much, such a relief to know what will happen in the future. x

Jimm_Alumni

Hi @clothears, welcome to our community. I'm glad your question got answered. Poppy is very knowledgeable about our countries complex benefits system.

We're here for support whatever happens in the future. It's good you're already thinking ahead about what-ifs but when the situation happens it's entirely normal to find it's a lot to deal with all at once. If you need some support, even just a place where you'll be listened to, we're always here!

clothears

Thank you, Jimm_Scope.

I do have a question about something Polly123456 wrote: How do I make sure I continue with NI credits? Is that something I request from the DWP when I contact them to tell them about a change in my circumstances? Also, what does LCWRA stand for?

Thank you.

poppy123456

It’s poppy not polly 😂 LCWRA is Limited Capability For Work Related Activity. It’s same as ESA Support Group. 

First thing you should do is ask ESA what your claim is made up of, whether it’s all Income Related or part contributions based. 

honestjon

clothears said:

I am currently in receipt of benefits, including income-related ESA Support Group, Housing Benefit, Council Tax exemption and PIP. I am 55. I live in a Council flat. 

My parents are divorced and in their eighties. Assuming one parent will die before the other, when this happens, I will inherit enough to buy a flat, just about. There will be a short period when the inheritance will be in the form of cash, between receiving the inheritance and me finding and buying a home, after which I expect not to have much in the way of savings. I understand I will lose Housing Benefit and Council Tax benefit permanently, but will I also lose ESA, either temporarily before I spend the inheritance on a home, or permanently because the home will be worth over £16K? I have read on this website that the home you live in is not considered part of your savings, but I want to make sure this is accurate, and I also hope to avoid being taken off ESA for several weeks/months and have to go through the process of re-applying for it. Thank you.

Have you thought about buying your council flat?
If you are happy living there it would be easier and cheaper to stay where you are. If you want to move away then this option won't be for you 

clothears

Gosh no. My flat is cold and damp and has shared outside areas with one upstairs neighbour who keeps the place looking trashy. It would never re-sell. I am looking forward to moving!

clothears

Thanks Poppy, (sorry, I easily get confused with names). Yes, I will have to find out for sure about my ESA, but I believe it's just income-related, not contribution.