Esa support income related and defined private pension

We want to hear from you: please tell us about your experience of the online community.

jkenn

Hi

I recently needed funds for new windows as the landlord freeholder wanted them changed due to rot.

I realised I could access a private pension which I had not considered thinking there would be nothing in it. There was £35.000

Being on ESA I knew a lump sum of £6000 would not affect my ESA Support income related. However I did not realise it was a defined pension, so you had to take the pension.

My ESA is standard £400.14 plus £423.27 a total of £823.41

The pension will be £1649.85 every quarter of the year, initially taxed at tax OT

I have no savings or investments

I did not seek advise as stupidly I had understood the pension would be deferred

My concern is being worse off as I am only just managing as it. Could I be? Also should I be concerned about this intial OT tax non cumulative?

I have already got the ball rolling and it may be too late to cancel, but as I need the money for the windows maybe I should just go ahead. Any advice would be much appreciated

OverlyAnxious

Hi,

Those figures suggest that you are on Universal Credit with LCWRA, not IR ESA with Support Group.

The rules are slightly different between those two benefits so need to be sure.

As you will be well under the £6000 savings limit, the savings impact isn't a concern. But I am concerned about the pension payments being treated as Unearned Income in the month that they are received each time. That could cause a large deduction in your UC payment for that month. One-off payments are only treated as savings, but as this will be a regular payment, I'm not sure. Hopefully someone else on here can confirm or advise differently, but I really would get some firm advice on this before it happens.