ESA and pension 'draw down'
Options
wild_one
Community member Posts: 95 Connected
I needed to access cash (draw down) from my private pension before Christmas. DWP have just sent me a letter informing me that there are will be no changes to my claim as the amount falls within the required limits. They have said the amount classes as 'savings'. What they didn't say was for how long it's classed as savings. eg for 12 months from receipt of money, 12 months from receipt of letter, or in that financial year? Has anyone any experience of this?
Thanks
Thanks
Comments
-
Hi,If you're receiving income related ESA and the amount you received takes your savings to more than £6,000 then it's not disregarded at all because savings of more than £6,000 will affect your ESA by £1 for every £250 over that amount.As it doesn't affect your ESA then i can only assume that the amount doesn't bring your savings above the limit or you're receiving Contributions based ESA, in which case it's never counted because savings don't affect contributions based benefits.Hope this helps.I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.If i see a question that i know the answer to i will try my best to help.
-
Thank you poppy. Yes it was a relatively small amount. My concern is that they have noted it as ‘savings’ and in that case how long does it sit there as savings?
-
No problem. It's savings because it was a lump sum. As long as your savings don't increase and reach £6,000 in total it's always disregarded. As soon as your savings reach that minimum amount then you need to report those changes, if it's income related ESA you're claiming.
I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.If i see a question that i know the answer to i will try my best to help. -
poppy123456 said:No problem. It's savings because it was a lump sum. As long as your savings don't increase and reach £6,000 in total it's always disregarded. As soon as your savings reach that minimum amount then you need to report those changes, if it's income related ESA you're claiming.
-
You're missing the point. As it's less than £6,000 then it makes no difference how long it takes you to spend it because savings of less than this amount are completely disregarded, forever. If your savings increase to above £6,000 at anytime then you report the changes.
I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.If i see a question that i know the answer to i will try my best to help. -
Ok, so if I drew down £4500 from my pension last November, and I draw down another £4500 in this coming November I have ‘savings’ of £9000 which puts me £3000 over the £6k threshold?
-
That's correct, if you still have other savings by that time BUT if you keep taking money like this then they could start asking questions because it could be classed as income, rather than savings. You need to get some expert advice before taking another lump sum because i won't be able to give advice regarding that.
I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.If i see a question that i know the answer to i will try my best to help. -
Hi Poppy. Do you remember this conversation from the beginning of the year. I failed to mention to you that although the amount I received was £4500 i was taxed approx £750. I understand why, but when I spoke to the lady at DWP and mentioned this I said I'd wait until end of tax year for the refund to be caught in the net as such. Well I have just received my P60 for 2019-2020 and there appears to be no mention of a tax refund. I have checked my gateway account and the pension payment is definately on there! So, should I be more proactive about the refund and fill in the online form. Or should I let it sit and let HMRC work through it?
Many thanks, as usual
-
Your tax allowance for the year 2019/20 is £12500 lets assume your taxable income from benefits is £5,000 plus the £4,500 that's £9,500 so you are a non tax payer and are entitled to a refund of the £750 tax paid, contact HMRC and ask for the refund and it shouldn't take long to get your £750 back.
Hope that helps?2024 The year of the general election...the time for change is coming 💡 -
woodbine said:Your tax allowance for the year 2019/20 is £12500 lets assume your taxable income from benefits is £5,000 plus the £4,500 that's £9,500 so you are a non tax payer and are entitled to a refund of the £750 tax paid, contact HMRC and ask for the refund and it shouldn't take long to get your £750 back.
Hope that helps?
Hi, yes thanks. I am aware of my tax allowance. My issue is will the refund be showing on my P60?
thanks
Brightness
Categories
- All Categories
- 13K Start here and say hello!
- 6.6K Coffee lounge
- 69 Games lounge
- 385 Cost of living
- 4.3K Disability rights and campaigning
- 1.9K Research and opportunities
- 199 Community updates
- 9.2K Talk about your situation
- 2.1K Children, parents, and families
- 1.6K Work and employment
- 768 Education
- 1.7K Housing and independent living
- 1.4K Aids, adaptations, and equipment
- 586 Dating, sex, and relationships
- 363 Exercise and accessible facilities
- 737 Transport and travel
- 31.6K Talk about money
- 4.4K Benefits and financial support
- 5.2K Employment and Support Allowance (ESA)
- 17.1K PIP, DLA, and AA
- 4.9K Universal Credit (UC)
- 6.2K Talk about your impairment
- 1.8K Cerebral palsy
- 868 Chronic pain and pain management
- 180 Physical and neurological impairments
- 1.1K Autism and neurodiversity
- 1.2K Mental health and wellbeing
- 317 Sensory impairments
- 818 Rare, invisible, and undiagnosed conditions
Do you need advice on your energy costs?
Scope’s Disability Energy Support service is open to any disabled household in England or Wales in which one or more disabled people live. You can get free advice from an expert adviser on managing energy debt, switching tariffs, contacting your supplier and more. Find out more information by visiting our
Disability Energy Support webpage.