UC cpital "deprivation"

Hi,

This is a difficult situation because there are no firm 'rules' on what you can and can't spend money on. The wording for proof that you have not deprived yourself of capital is this:

A claimant is not treated as depriving themselves of capital if they -

1. Use it to reduce or pay a debt owed by them; or
2. Purchase goods or services if the expenditure was reasonable in the circumstances of their case

So if they haven't given an explanation then you can still write the MR. Just explain that the goods or services were reasonable in your circumstances. You should be able to calculate which items were 'not allowed' as you will still be treated as having that amount of savings, and that will cause a fixed deduction on your UC amount. This is listed on every UC statement.

Yes I do agree with you. But getting accurate information out of UC rarely seems to be easy, so I would just bypass them altogether and write the MR.

You can also make it clear that they failed to provide suitable evidence as to why they believe it to be deprivation.

I think you may have misunderstood how this works.

Deprivation of capital means reducing your savings. It is not about spending UC income.

Yes, as it's a special circumstance. There was a 12 month capital disregard for people migrating from Tax Credits.

so however you spend your income ( UC/ pip ) can’t be regarded of depravation ? It only applies to savings ?
I think there was a thread where you said if the day before your assessment period was over and you had withdraw the £50 that would’ve taken you over the savings limit , this could be seen as deprivation? But that £50 would’ve been from income .
im just confused about all this .

It is confusing, and I try to simplify it where possible to avoid causing even more confusion.

Basically though, as long as you spend income, from the bank account in which it was paid, within that payment period (or most of the next period), then it does not count as capital. It becomes capital on the last day of the following payment period for both UC and PIP. (Bearing in mind the dates will be different for both UC & PIP). That is what the Deprivation of Capital rules cover. They do not cover income, only capital.

However, proving whether you're spending income or capital gets difficult unless you use a different bank account for capital.

With the £50 analogy, if you take it out on the final day of your payment period, that is the point where it counts as capital. If you took it out the day before the final day then in theory you could claim it was still income. However, you cannot keep it as cash because cash should also be declared as part of your capital. And if there was at least £50 in that account before the start of the previous payment period, then DWP could claim that it was capital from before, rather than income from this period.

Yes, that is correct for Deprivation of Capital. That is what other long term members have advised on here in the past, spending all of the income within the payment period so there's no capital to worry about.

For the sake of total honesty, I am not 100% sure that there aren't some other rules for spending income. I am not aware of any at this point though.

I must admit, on a personal level, I don't agree with spending for the sake of spending, and I also feel it gives us a bad look, and puts us into the stereotype of benefits claimants wasting money on luxuries. But I also feel like we're pushed into it with the daft rules on capital deprivation. If I was designing the system, there are some changes I would make to it!