Would my sister have time to use money from sale of house before it affected her benefits?

Karron

My sister received ESA and PIP Her hose is no longer suitable to stay in. Plans are to buy another suitable house at a similar value. We estimate about a £20000 surplus from the move which would be used to make necessary renovation work. Am I correct in saying that she would have time to use this money before her benefits would b effected. One last question where can I get legal advice regarding this?
Thank you in advance 

poppy123456

PIP isn't affected because it's not means tested. You haven't said whether her ESA is Income Related or Conributions based/New style.

If it's Income Related, If there’s a gap between selling their current home and buying another then it can be disregarded for 6 months sometimes longer. 

If she buys another house as soon as her current home is sold, if there’s any money left over and it’s more than £16,000 any Income Related ESA will stop because entitlement to means tested benefits ends if you have savings/capital of more than £16,000. It's not disregarded whilst work is done to the house.

If her ESA is Contributions based/New style then both are not affected by savings/capital.

For legal advice she would need to speak to a solicitor.

Karron

She receives ESA for a disability or health condition that affects how much you she could work. Been receiving this for 10 years+ Currently age 65 so unlikely to be the new version 

poppy123456

Yes, that's the reason why people claim ESA. My advice remains the same as above, if any part of it is Income Related the savings rules apply.

For council tax reduction all Local Authorities have their own savings rules and some have maximum savings amount of £6,000 before entitlement to council tax reduction ends.

ShirleyW

Karron said:

She receives ESA for a disability or health condition that affects how much you she could work. Been receiving this for 10 years+ Currently age 65 so unlikely to be the new version 

It is necessary to tell the forum whether any of the ESA is Income Related or if it is just the Contributions Based Esa.  It will make a difference to the advice given.  Everyone who receives ESA receives it because of a health condition affecting how much they can work.

I think that if you can state how much and how often your sister receives it, the more experienced posters can tell if it is just Contributions based or includes an Income Related top up.

poppy123456

If she's in the Support Group and she receives £117.60/week then this is contributions based. Anymore than that then at least part of it will be Income Related.

If she's in the WRAG then all of it will be Income Related.

Karron

I’m out at the moment so will check amount and confirm I do know it’s paid every 2 weeks

poppy123456

Karron said:

 I do know it’s paid every 2 weeks

ESA is always paid every 2 weeks regardless of which one you're claiming.

Karron

A letter dated 15/03/2022 says The payment of ESA is based on NI contributions and any additional amount the law says you need to live on. 

poppy123456

Karron said:

A letter dated 15/03/2022 says The payment of ESA is based on NI contributions and any additional amount the law says you need to live on. 

ESA letters are always extremely difficult to understand. As advised here.

poppy123456 said:

If she's in the Support Group and she receives £117.60/week then this is contributions based. Anymore than that then at least part of it will be Income Related.

To know for certain exactly what her ESA claim is made up of then she will need to ring ESA to ask.

Karron

No I think that bit is around about £40

poppy123456

Karron said:

No I think that bit is around about £40

That doesn't really tell me anything other than there's likely to be some reduction for something. You need to ask her exactly how much her ESA is because it's impossible to give any further advice without knowing what her ESA claim is made up of.

Karron

So £121.05 Living expenses for you and your partner
£25.35 Disability Income Guarantee/ limited capacity to work
£40.60 Support Group
Total £187.00

poppy123456

As the partner is on the claim then at least part of the ESA is Income Related. Therefore this advice applies.

poppy123456 said:

 If there’s a gap between selling their current home and buying another then it can be disregarded for 6 months sometimes longer. 

If she buys another house as soon as her current home is sold, if there’s any money left over and it’s more than £16,000 any Income Related ESA will stop because entitlement to means tested benefits ends if you have savings/capital of more than £16,000. It's not disregarded whilst work is done to the house.

If any part of it is contributions based (£117.60/week) this will continue. If all of her ESA ends then once the savings go below £16,000 she can reclaim benefits but it will need to be Universal Credit that she claims.

Karron

Thank you not the answer I was hoping for but at least we know now

poppy123456

One other thing. If her ESA ends when she claims Universal Credit she will need to report her health condition and send in fit notes. She will need to go through the work capability assessment again.

calcotti

poppy123456 said:

One other thing. If her ESA ends when she claims Universal Credit she will need to report her health condition and send in fit notes. She will need to go through the work capability assessment again.

If the ESA ends they should keep a ‘credits only’ ESA claim which will preserve the LCW/LCWRA status and this should, I think, be taken into account if UC is later claimed

poppy123456

Thanks Calcotti. I didn’t think a credits only claim would preserve the LCWRA element. 

Karron

She has an assessment 12-18 mths ago and secured benefits for 10 years. But I do wonder what will happen next year when she becomes pension age.

calcotti

Karron said:..But I do wonder what will happen next year when she becomes pension age.

At pension age ESA ends, State Pension starts and, if applicable, Pension Credit can be claimed tontop up the State Pension. The PIP continues.

When it comes to Pension Credit capital over £10,000 will reduce any possible Pension Credit entitlement but there is no absolute capital limit.

Karron

Do you mean savings over £10,000 I thought the limit was £16,000?