Injury Compensation over 16k and UC but..... — Scope | Disability forum
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Injury Compensation over 16k and UC but.....

Lost
Lost Member Posts: 50 Courageous
edited July 2020 in Universal Credit (UC)
Hi guys I really hope someone can help me here. I'm about to receive compensation which is over 16k but I will be paying off debts which will leave me way less then 16k I already got letter from CRU telling them I owe them £0 on certificate. 

Question is do I still need to let them know about this money because they already know about it and specially after I paid off all my debts I will be left with way less then £16k I was told as long as it's under 16k it's fine and I don't need to worry about it.

I'm unabld to work due to long term disability and clearly I don't want to get in trouble.

Any help would be great 

Thank you

Comments

  • poppy123456
    poppy123456 Member Posts: 31,122 Disability Gamechanger
    HI,

    Yes, you will need to report the money when you receive it in your bank. Once you've paid off your debts then anything you have left that's over £6,000 will affect the amount of UC you're entitled to and it will reduce by £4.35 for every £250 or part there of over that amount.

    If you're claiming council tax reduction then you will also need to report the changes to your local council. As you will have more than £16,000 you won't be entitled to any council tax reduction. Paying off debt will be classed as deprivation of capital for the council tax reduction.

    For others that are reading this paying off debt when claiming Universal Credit isn't classed as deprivation of capital, like it is for the old legacy benefits.

    Hope this helps.
  • woodbine
    woodbine Member, Community Co-Production Group Posts: 7,715 Disability Gamechanger
    Hi @Lost hope you're ok today? Paying off debts with UC is not a problem, but any capital over £6000 will result in UC being reduced by £4.35 per £250 (or £17.40 per £1000) so yes you will need to tell them.
    Be extra nice to new members.
  • Lost
    Lost Member Posts: 50 Courageous
    edited July 2020
    Ty for that info. Can I also ask if I'm giving money to my 2 children £1000 each which they can't access till they are 18 do I have to declare this also? No one can access that money till they are 18. 

    I just want to make sure I will not be penalised.

    Also how long will my UC be reduced till I have this savings or specific  time ? 

    Thank you
  • poppy123456
    poppy123456 Member Posts: 31,122 Disability Gamechanger
    edited July 2020
    Giving money away is definitely classed as deprivation of capital for all means tested benefits and you'll still be classed as having that money, if you do. Even if they can't access it.

    There's no specific time that it will be reduced for, it's reduced until your savings drop below £6,000. Obviously don't go out and buy the most expensive things to reduce it further.

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