ESA, PIP and lodgers

Jenwren

Hi

I'm in a bit of a bind and I'd appreciate some advice. I get ESA and PIP (both higher tiers - my only source of income) due to my health conditions. I've only started receiving PIP this year. I'm living in my deceased mum's house as I was her carer and she passed away last year. The house is in probate and has been left to me, but can't be sold due to a disgruntled relative putting a caveat on it so probate can't continue until it's lifted.

My issue is this: I'm stuck living in my mum's house (it's also my home) but I'm struggling to afford the utility bills and I really need to get lodgers in to help - I have spare rooms but I heard it mucks up my ESA if I get lodgers, but I'm stuck because I can't move out, sell or rent somewhere cheeper because my benefits won't cover that. The morgage is paid off on the house so it's just utilities but these are expensive (I've tried getting them down).  My stepdad is technically living here but may be moving into care soon (he has dementia) and is in respite. I am paying for all the bills now.

Some people have advised I come off ESA, but stay on PIP as I think I can rent to lodgers then (I think they said PIP isn't counted). I spoke to citizen's advice before I was granted PIP and they said I could rent but I could only keep a small amount I think 10-20 pounds of the rent! The house is basically too big and expensive for me to keep but I can't sell it right now, and lodgers are really the only way I can afford it but I could end up loosing my benefit. Can anyone offer any advice?

poppy123456

PIP isn’t affected. If your ESA is income Related then you were advised correctly and only £20/week is ignored for ESA after that then the ESA is reduced £1 for £1. If the rent includes at least 1 meal then only 50% of the rent above £20/week is counted as income. See link 
https://england.shelter.org.uk/housing_advice/repossession/taking_in_a_lodger_if_you_have_mortgage_arrears

please note that is says mortgage arrears so you can ignore that. It’s the part further down in “other benefits “ that you need to look at. 

If you claim Universal Credit then rent from a lodger is ignored. Again, please see link above regarding this. 

Does your ESA include the Severe Disability Premium? 

Also if you’re currently claiming single person discount for council tax then you will lose that also if you have a lodger. 

Jenwren

Thanks for advice. I'm not on UC, just ESA and PIP. I get the higher tier for both but the utilities are just high because it's a family sized home that was extended before my parents bought it (think 70s house prices). With probate frozen, I don't know how long I'll be stuck here. I can manage utilities but if they go up - I already have a leak I'm trying to locate (it's too small to be located right now) - just having lodgers would just help me a lot.

I've had some people suggest it might be better for me to come off ESA, stay on PIP and just rent out the rooms - I've got two spare bedrooms and a live-in annex part of the house that I could rent but due to ESA it seems I can't. If I can only keep £20 per week, it's not  worth me loosing my CT deduction and the extra cost of utilities with more people using them.

My brother is really pushing me to get lodgers (I've offered to give him some money from them as he's financially struggling before I knew about ESA rules) but I keep trying to explain it's not as simple as he thinks due to my ESA.

I know I'd loose my council tax deduction which isn't great. Right now technically my stepdad lives with me and is discounted becuase he has dementia, but is currently in respite and basically needs to go into a care home (we're waiting for a panel to agree).

I'm really wary about getting lodgers but it is very lonely by myself and the house needs repairs that I can't afford.

Has anyone else been in this situation? Would I be better just getting off ESA? I'm really scared to do so but I wonder if it might be better as then I could rent all my rooms, but I don't know. I'm really scared of making the wrong decision.

poppy123456

I know you’re not claiming Universal Credit at the moment. The reason I advised that was because income from a lodger is disregarded for UC purposes so what’s stopping you from claiming UC? 

If you’re in the Support Group for ESA you’ll be entitled to the LCWRA element from the start of your claim. 

It seems rather strange to stop claiming ESA to have the lodgers when you can claim UC, which would mean you will have that money as well as the Income from the lodgers. 

Jenwren

I never considered claiming UC to be honest. I don't really understand the rules around it. I didn't claim PIP until this year and only then because someone advised me to (I assumed incorrectly it replaced ESA).

Just to clarify - if I did apply for UC, and got it (big if) would it replace my ESA? I get confused what which benefit would be best for me. Is UC income based like ESA? With my ESA I'm in the group where you don't have to look for work.

I think I read that if you have UC you can keep money from lodgers, correct? I'm worried about applying for UC because I keep hearing about the govt cracking down on benefits, esp UC so I'm wary about applying. Sorry about coming off as completely ignorant about UC.

poppy123456

UC is means tested like Income Related ESA.

If you claim UC then any Income Related ESA you’re claiming will continue for 2
weeks and then end. Then the UC will replace the ESA. 

If any part of it is contributions based this will continue but be deducted in full from any UC entitlement. You would then receive ESA at £138.20/week, with UC to top that up. The contributions based part of ESA will not be affected by income from a lodger. 

Both groups for ESA mean you don’t have to look for work. The Support Group means you don’t have to attend any work focused interviews. 

For UC the LCWRA is the same as Support Group and you would be entitled to that from the start of your claim. 

The announcements by the Government are just things that may happen, nothing is final yet and IF they do it will apply to ESA and UC.

Yes, you read correctly and income from a lodger is not counted for UC purposes.

Jenwren

I've been looking through my ESA letter and I think it looks like I get income-related ESA. I'm also in the support group of ESA.

So if I applied for UC and got accepted for it, would I be able to keep my ESA and get lodgers, or would my UC replace ESA and then I could get lodgers? Sorry if I'm being a bit thick about this. I'm just worried if I got UC it wouldn't be as much as my ESA due to me getting the higher tier.

I'm wondering if it'd be worth trying to get an appointment with my local Citizen's Advice and asking them?

poppy123456

It would be difficult to know if any part of your ESA is contributions based and it’s not easy to tell by just the letter because they often make no sense at all.

Does your ESA include the Severe Disability Premium? 

There’s no doubts at all that you would be refused UC because at least part of your ESA is Income Related. 

If all of your ESA is Income Related then this would end 2 weeks after you claim UC, which means UC would replace your ESA. 

LCWRA element pays more than ESA Support Group of your ESA doesn’t include the Severe Disability Premium. 

If you’re going to take in lodgers then claiming UC is clearly the most sensible option because income from them will not affect it.

I would throw some caution about speaking to Citizens Advice because they don’t always give great advice. 

Jenwren

The letters really aren't that helpful. So my latest ESA letter says I get extra money due to being severely disabled, but I'm not sure if that's the same thing as severely disabled premium.

If Citizen's Advice isn't overly helpful, is there anyone else I can talk to work out if I'd be better off? I've tried using a benefit calculator online but I just got confussed.

So even if I applied for UC would I be automatically rejected because of my ESA being income related? I heard you can ring DWP to find out about your ESA  type etc but I'd rather avoid phoning them. I have no idea when I will be re-assessed for my ESA (they didn't give me any indication at my last review and I heard they are very behind).

Maybe it's just best to forget UC and lodgers. My ESA wasn't very much until I got PIP so I really don't want to rock any boats etc but if there's anyone I can speak to independently for some advice that'd be great. I do have a social perscriber but we paused our sessions as I was really struggling with anxiety and depression and I had some mental health sessions that have now finished and I'm just waiting to hear back from my social perscriber. Do you or anyone on the forum know if there's any places/people that can given accurate, impartial information about benefits etc. Talking to the DWP just scares me!

kimkenzie202

If you are getting Income Related ESA then you will also get UC, you will be moved to UC, ESA ends. Most people are better off on UC, if you get the Severe Disability Premium you will be worst off though.

I recommend you claim UC because you can keep your benefit and have lodgers.

poppy123456

That means your ESA includes the severe disability premium. To put it more simple for you then if you claimed UC without having a lodger then you would be worse off. 

If you have a lodger and remained on ESA how much your ESA would reduce by will depend on how much you charge you lodger. 

Please do NOT ring any DWP department for any benefits advice because they are not benefits advisors. They are call centre staff who sit there reading from a screen. 

Jenwren said:

So even if I applied for UC would I be automatically rejected because of my ESA being income related? 

No you will not because as I keep advising, when you claim UC your Income Related ESA will end after 2 weeks. If any part of it is contributions based this will continue but be deducted in full from any UC entitlement. 

This link will help you find what advice agency is local to you.https://advicelocal.uk/welfare-benefits

Jenwren

thank you for the link, I really appreciate it. I'll look into it and hopefully it'll be me figure things out. I'll also be cautious about asking DWP and Citizen's Advice.