Savings universal credit

sophier123
sophier123 Community member Posts: 8 Listener
in Universal Credit (UC)
Hi, I get universal credit and had a car accident 2019 and getting paid out £7400, when you get paid out for a car accident your money isn’t counted as savings for 52 weeks so it’s ignored for a year, I’m worried about what I can spend it on during this year as after 52 weeks it will count as savings. Can I spend it how I want the 52 weeks or will it be classed as deprivation of capital ?

Comments

  • poppy123456
    poppy123456 Community member Posts: 60,310 Championing
    You can spend the money on what you want to during that time because it's ignored for a year.
  • sophier123
    sophier123 Community member Posts: 8 Listener
    Are you sure ? Just worried because don’t want to spend it and then after the year they say I shouldn’t of done that and I loose money 
  • poppy123456
    poppy123456 Community member Posts: 60,310 Championing
    Yes i am. If you couldn't spend on what you wanted to then it wouldn't be ignored for a year.
  • sophier123
    sophier123 Community member Posts: 8 Listener
    Great thank you, even after the year if I have it is spending the money on a holiday classes as deprivation of capital?
  • Sue_Alumni
    Sue_Alumni Scope alumni Posts: 484 Empowering

    Hi @sophier123

    The £7,4,00 is ignored completely for 12 months from the date it is paid to you.  You can spend the money as you like just as poppy says. After the 12 month period capital below £6000 continues to be ignored. Capital over £6,000 is treated as providing income, known as “tariff income”, of £4.35 per month for each additional £250 (or part thereof).

    The upper limit is £16000, so anyone with savings (capital) over £16,000 cannot get Universal Credit.

    If after the 12 month period your capital is over £6000 and you  spend your capital to increase your UC then you could be treated as depriving yourself of capital. However, you can still spend capital on goods and services which are reasonable in the circumstances.  What is considered reasonable isn’t defined but day to day necessities and replacing household items would probably be OK but an expensive holiday wouldn’t be.  If you still had capital over £6000 after the 12 month period it would be sensible to keep receipts for purchases so you could demonstrate that you weren’t deliberately reducing your capital.  


  • sophier123
    sophier123 Community member Posts: 8 Listener
    Great thank you, so if I spend money now for example on a holiday and I’m under 6,000 now they won’t ask about it in 12 months? 
  • poppy123456
    poppy123456 Community member Posts: 60,310 Championing
    edited July 2022
    sophier123 said:
    Great thank you, so if I spend money now for example on a holiday and I’m under 6,000 now they won’t ask about it in 12 months? 

    If after the 12 months your total savings exceed the £6,000 then it will be your responsibility to report the changes.
  • sophier123
    sophier123 Community member Posts: 8 Listener
    Great thank you,do I need to inform the dwp of the money now? Or after 12 months if it’s still over 6,000? I’m sure they will probably be aware about me receiving it anyway as solicitor has to report stuff etc 
  • poppy123456
    poppy123456 Community member Posts: 60,310 Championing
    I think you should report it even though the solicitor should have done that. It's disregarded anyway.
  • janer1967
    janer1967 Community member Posts: 21,922 Championing
    Just to point out if you are on uc and go abroad you have to inform dwp 

    If you are classed as lcw or lcwra you have no work commitments so it isn't an issue but if you are a job seeker you are required to be available to work of look for work 

    Going abroad could affect your uc payment 
  • sophier123
    sophier123 Community member Posts: 8 Listener
    Who said about going abroad ? But I’m lcwra anyway 
  • janer1967
    janer1967 Community member Posts: 21,922 Championing
    Sorry you didn't but you said spending it on a holiday which is same if its abroad or in UK in eyes of dwp 

    But I'm glad it isn't an issue for you I was only advising as you showed concern in your post about not getting into trouble 

    Sorry wasn't intending to upset you 

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