Pension lump sum ,advice

rita444
rita444 Online Community Member Posts: 40 Contributor
in Benefits and income

Hi everyone I'm asking this question for my sister. She's now reached pension age ,and will receive her state pension . She lives alone in a one bed flat ,

As she will no longer be working she my be able to receive ,housing benefit ,council tax reduction ,she won't get pension credit as she will be receiving full state pension

She will also be getting a private lump sum pension from her small works private pension ,around 9,000 hopefully this will be classed as savings . The question is she wants to gift 1,000 each to her 2 adult grandchildren, to help them out , is this classed as deprivation of capital and how would this affect Hb , if she applied fot it . This would leave her 7000 in savings , if it is doc ,it's such a shame she can't treat her grandchildren .

Any advice appreciated

Comments

  • OverlyAnxious
    OverlyAnxious Online Community Member Posts: 3,749 Championing

    Hi,

    Gifting large sums of money would very likely be considered deprivation of capital.

    Housing Benefit & CTR are still managed by individual councils. You would have to check the capital rules for her specific local authority. I have seen limits at £6000, £10,000 and £16,000 so far.

  • rita444
    rita444 Online Community Member Posts: 40 Contributor

    Hi thanks for your advice. So if the capitol rules in her area regarding Hb and council tax is 10,000 limit savings dose that means she would be able to gift he grandchildren some money

    Will the still be questioned about it , would she also be questioned about what she does with any of it she also wants to buy herself a new washing machine and cooker . Thanks advice appreciated

  • OverlyAnxious
    OverlyAnxious Online Community Member Posts: 3,749 Championing
    https://forum.scope.org.uk/discussion/comment/989665#Comment_989665

    I would expect them to ask for bank statements as she has over £6000. So if she has given away £2000 shortly before applying then yes, they can ask what she's done with it, and can consider it to be deprivation.

    However, all that happens is she would be treated as still having that money. So if it's a £10k limit, and she is treated as still having £9k, then she would still be eligible for the HB & CTR anyway. There may be a slight deduction in the rates, although that is again down to each individual council rule.

    She may be questioned on large purchases such as a washing machine or cooker, though once explained what those payments were for, they should not be treated as deprivation, unless she has bought the most expensive appliances, for example.

  • rita444
    rita444 Online Community Member Posts: 40 Contributor

    Thank you for your advice

    I will let her know ,she's never claimed benefits all her life ,and now she's going to get her state pension,and small works pension ,I don't think she understands it all .thanks again

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