Inheritance Effects ESA ?

Richard74

Hello Everyone 

I'm currently claiming income related ESA my father passed away in January he has left me a bungalow in trust i do not own the property but i am soul beneficiary so i would receive the rental income of between £800-£1000 a month  also the sum of £20.000 cash that is currently in probate will my ESA stop completely ? Thank you  

Richard74

hi @woodbine Thank you for your reply so i may still get something but reduced ?

chiarieds

Hello @Richard74 - & welcome to the community. Have you managed to look into the above?

Richard74

@woodbine @chiarieds thanks for your help I am in the support group I receive £260 every 2 weeks I’ve been in there for 6 years as I have chrons disease I do 14 hours permitted work a week . 

chiarieds

@Richard74 - This sounds like your ESA is income-related from what you've said with support group paying £228.20 every 2 weeks + the enhanced disability premium of £34.40 giving now £262.60. Is it that amount?

Richard74

@chiarieds yes that’s correct 

calcotti

As advised by woodbine you need to check whether the ESA is entirely income based or is contribution based with an income based top up. You will also need to inform your local authority if you are claiming Council Tax Reduction and/or Housing Benefit.

Whether or not the bungalow counts as capital will depend on the nature of the trust. The rental income is treated as an increase in capital, not as income.

Richard74

@calcotti @woodbine The trust is not yet set up that could take months . the letter from the dwp is 

your living expenses £74.35
extra money because of the disability income guarantee £17.10
Limited capability for work addition 
extra money because you are in the support group  £39.20
which gives a total income-related amount £130.65

income & benefits 
no income will be taken off your ESA 
your income related amount is £130.65 less total income of 0.00
so your income related entitlement is   £130.65
that is the only benefit i claim 

calcotti

It appears to be entirely income based 

Richard74

After contacting the DWP i was told rental income was not seen as earnings only as an income in savings and i lost £16 a week in my benefits i thought i would have lost it all very surprised .

calcotti

Richard74 said:

After contacting the DWP i was told rental income was not seen as earnings only as an income in savings 

Are you saying they are treating it as income? That doesn’t seem correct. It should be seen as an increase in capital. Are you clear how they have arrived at a deduction of £16/week? A deduction of £16/week would correspond to notional income if you have capital between £9,750 and £10,000.

What has happened to the £20,000 you referred to in your opening post? If you have capital over £16,000 you have no entitlement to income based ESA.

Richard74

sorry they said the rental income was increase in capital the £20,000 is in probate and i have not received it yet .

calcotti

Richard74 said:

sorry they said the rental income was increase in capital the £20,000 is in probate and i have not received it yet .

That makes sense.