Over £16k, very worried, looking for advice please
Hello. Me and my partner have been on benefits since 2008, in 2020 I received inheritance that put us just over the £16,000 limit. I never declared this as I did not see it as my money due to not being able to accept the deaths of my grandparents. I think we may have just gone over the £6000 limit before that due to not spending much and it slowly accumulating. We were also panicked about having to sign off and going back through the medical assessments. I now realise I should have just come forward at the time.
We have had over £16k for the past four years, we want to come forward and pay back all that is owed but we are worried sick about being prosecuted and going to prison, my partner has had a nervous breakdown and is suicidal, my anxiety is through the roof.
Would the DWP want four years of benefits back or would they calculate the fact we would have only been over £16k for a couple months at most before going back under the limit due to living on that money without any other income? The deductions would also have been less each month due to money going out and capital going down.
Comments
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Which benefits exactly are you claiming please? Not all benefits are means tested. I can advise further once you've answered that question.
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Sorry, Income related ESA (support group), Housing and Council Tax.
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Thank you. If at least part of the ESA is contributions based then that will not be affected and would have continued to be as normal but at a reduced amount than what you were receiving.
If all of the ESA is Income Related then that would have ended as well as Housing benefit and Council Tax reduction.
As you still have more than £16,000 then you really need to report the changes for all of your benefits. Some local Authorities have a maximum limit of £6,000 before council tax reduction ends.
It's always better if you report the changes and be honest with them, rather than any of them finding out first. By reporting the changes you'll likely end up with a small fine on top of any overpayment. It's unlikely you will go to prison.
They may ask for all of the years to be repaid back, but ultimately it will be down to a decision maker to make that final decision.
There would be a deduction of £1/week in the ESA for every £250 or part thereof over £6,000 if you had over that amount before you received the inheritance.
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Thanks for the reply. That is why I cannot come forward, if they wanted all four years total benefits paid back we would owe nearly £70k and Im sure that would be prison.
Not fair though because we would have gone straight back under £16k after a month or two from using it to live and then just had the deductions each month.
Why could they not calculate it properly showing our capital decreasing each month.0 -
Hello @munchpump, can I ask if your capital total includes the cost of living payments and if you removed those, would the total be under £16,000?
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Its currently £24k, includes COL payments and £1300 is my Dads money that Im looking after due to him being in a care home.
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Ah, okay, thank you for confirming @munchpump.
I had hoped that by removing the COL payments, the total would fall under £16,000 (as they are disregarded as capital). Unfortunately, I can only find information on them calculating a decreasing capital amount each month with regard to notional capital, not actual capital.
While I understand your concerns, the longer you leave it to report the change, the worse the situation could become. If they do ask for the full amount to be repaid, they may use your savings to recover it, with the remainder being paid in small regular instalments.
Given the large sums involved, I'd recommend seeking assistance from a Welfare Rights service or a specialist organisation in your area. You can find available services near you through Advicelocal.
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I would have only been over £16k for max 2 months and then have to re-apply so how is it fair for them to say I would owe all money claimed these past years?
What if I signed off now, lived on it and re-applied when under £16k? Would they want proof of where the money came from?0 -
If you don’t report it and they found out it could be worse than it would be if you reported it.
When your capital fell back below £16,000 you wouldn’t have been able to reclaim Income Related ESA or housing benefit anyway because Universal Credit has replaced those and it’s not been possible to start a new claim since end of December 2018.
I don’t know if they would offset what you may have been entitled to against the overpayment but as it would have been Universal Credit you would have needed to claim this may not be possible. You would need to get expert advice on this. Even then it would be down to a decision maker to make the final decision. Usually UC can only be backdated for a maximum of 1 month under the most extreme circumstances.
You will also soon be asked to claim UC as part of managed migration because Income Related ESA and housing benefit are ending. When you claim this you will be asked about any capital you have. With your current capital you would not be entitled.
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We are due to migrate to UC in March, I am not doing this as I am over the £16k so all benefits will cease. We are too unwell to work so after going back under £16k could we make a new claim for UC down the line?
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Yes you can but there will be a deduction of £4.35/month for every £250 or part thereof over £6,000. You will need to make sure you report having more than £6,000 in capital and maybe asked to provide bank statements.
For your current benefits you really do need to do the right thing and report this.
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I want to do the right thing but I do not trust the DWP to calculate correctly and/or send us to prison. Nobody knows what they would decide and that scares the life out of us.
Would UC want to see how long we had our savings?0 -
DWP can’t send you to prison, only a judge from court can do that. I can only advise that it would be worse if they found out, rather than you be honest and report what’s happened.
When you claim UC if you have more than £6,000 then yes they will ask for bank statements.
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@munchpump, @Morgan_Scope I found out there are some rules about diminution of capital for legacy benefits and it seems housing benefit has similar rules. I think there are different rules for notional capital not actual capital. It all seems quite complicated but I think these rules have to be applied when calculating overpayments for undeclared capital over the capital limit.
Chapter 3.31 covers Diminution of capital.
Also, if you go on the Rightsnet site and search for diminishing capital there are some posts that cover this.
I don't know if this will be of any help but thought I would post in case.
All the best.
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Hi
I would highly recommend you take @poppy123456 advice and inform the DWP yourself to avoid legal complications.
It’s far more likely they will seek legal action if they find out about it and you haven’t told them(Would be classed as Benefits Fraud), With Labour cracking down on benefits I wouldn’t advice the risk of not informing DWP about this as the outcome will definitely be more severe for you.
If you explain the situation and circumstances the DWP will work out the best way to recover any overpayment etc with you.0 -
I can imagine the stress you and your partner under I can imagine you both making yourself more ill anything to do with dwp is scary I read that loads of people have been found to go over the savings limit and no one been jailed so try not to worry about that the only way through this is to go through it I would do a break down of what you spent money on if you can remember I know how anxiety can make you more terrified and harder to deal with you have till March to workout yourself what money went on so have all ready
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Think you might of replied to the wrong person by mistake.
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Trust me sorry
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Not to worry it’s easily done ☺️
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Hi, how long would it take them to calculate what we owe? We are due to migrate to UC in March so if we paid them back a lump sum in the next two months we would be well under £16k and able to migrate.
Also would it be classed as fraud if we went to them first and told them? I read about them automatically prosecuting people £2k over the £6k limit, seems they like to make an example of people and splash their names across the papers.0
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