Will taking lump sum pension payment be capital or income?

DerekDR

DerekDR

Hi

Hope someone can help.

I have been offered a small pot amount by a pension provider. This amounts to about £3,300 less tax. If I take it my savings would still be less than £6,000

I currently claim housing benefit, so the question is if I take the amount, will it be classed as income by the council, thus reducing HB or will it be taken as capital and have no affect on HB

Thanks in advance for any help
Derek

Jimm_Alumni

Hi @DerekDR, welcome to the community 😊 I hope we can help!

Given you are taking from the pension once and not as a continuous income this should, as far as I am aware, be treated as capital. When it comes to your council it would not hurt to double check with them perhaps?

I'll just move this over to our benefits category so other people can offer their ideas!

DerekDR

Many thanks for your help

poppy123456

Yes, it's treated as capital, not income. As it doesn't take your total capital to more than £6,000 it will not affect it.

As it's a pension drawdown, you will still need to report it to your local Authority just so they know about it because they will highly likely receive information about it.

DerekDR

Manny thanks for your help @poppy123456