Universal Credit Review & Pension Pot

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  • Alan57
    Alan57 Online Community Member Posts: 3 Listener

    HI Poppy, I cashed in a pension 2 years ago (20k) withdrew the 25% tax free initially, and have been withdrawing regularly now since.I didn't declare the change in circumstances as was told the pot wasnt classed as income or savings. Obviously this review coming up will show the extra money I've been taking and I'm guessing this will open up a can of worms. Will my claim be closed/sanctioned or may I even be prosecuted do you think?? Obviously they will want any overpayments paid back..was just looking for a bit of a heads up as to what to expect. Thanks for taking the time.

  • poppy123456
    poppy123456 Online Community Member Posts: 63,855 Championing
    edited December 2024
    https://forum.scope.org.uk/discussion/comment/950272#Comment_950272

    Were you claiming UC or any other means tested benefits at that time? If so they would have ended with capital punishment of than £16,000.

    Money in a pension pot is ignored when under state pension age. However, if you withdraw anything such as lump sums or a regular income then it’s not ignored.

    You will need to declare all of this. Any overpayment will need to be repaid back. There will likely be a small £50 fine on top for not reporting the changes.

    Are you also claiming council tax reduction? Some local authorities have a maximum capital limit of £6,000 and anything over this entitlement will end. You should have also reported the income from it.

  • Alan57
    Alan57 Online Community Member Posts: 3 Listener

    Yeah I was claiming Universal Credit already before this happened.I didn't have savings/pension pot when I opened claim, just didn't declare it when I did...my own stupid fault. Thanks for your input and taking the time to reply, appreciate it.

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