I think I know the answer to this but just in case:

Client estranged from partner. Both over 60years of age. He wants to sign over the former matrimonial home to his now seperated from wife. He says he feel as moral obligation to do this has it was her father who paid a large part of the deposit and he has always felt that it was her's more than his. There is no intention to dispose of his share of the property in order to claim benefit or get extra benefit it purely an action as he feels that it is his moral duty to sign the property over to her. This being the case, I think that deprivation will not be an issue so notional capital will not be applied for this reason; but please tell me if and why you think I'm wrong.

However, a more thorny issue arises in that he might be held to hold notional capital because:

""...fail to apply for capital which is available to you..."

I think he's stuffed and will be treated as having notional capital under the last bit above or, indeed, the first bit above. Please tell me if I am right or wrong. Thank you.

Hi Paddy

Transferring the legal title does not of itself deprive him of his beneficial interest, so deprivation does not apply.

There could be a failure to apply problem. However as the asset is the matrimonial home it could be the subject of current or future divorce proceedings and thus his (if any) beneficial interest may not be immediately available to him. He needs to see a family law solicitor for expert advice.

Regards
Paul

The are to be no divorce proceedings.

I would still seek legal advice to determine what his beneficial interest is likely to be.

It's PC not IS rules that apply. There is no PC rule about 'failure to apply' for capital. Compare Reg.52 IS regs with Reg.21 SPC Regs. Reg.21 only covers deprivation (and company shareholdings). If you're confident on the deprivation issue, no problem.

Richard Atkinson

This is a matter of Housing & Council Tax Benefit.

I think that you are right; legal advice is the way forward. There may be a miriad of tangles amidst this web. Thank you for your help.

I have a burning question...

If the claimant wanted a beneficial interest in the property, why would he sign it over?

The initial post doesn't suggest the claimant wants to keep the beneficial interest, but if he does, and I were a DM, deprivation would be very high on the list - especially as a 'market value' calcuation of his interest is likely to be very low, if anything.

Richard is absolutely right of course. I had overlooked the fact that they are both over 60, so there is no “failure to apply” provision in the HB(Persons who have obtained the qualifying age for state pension credit) Regs 2006. However legal advice should still be sought to determine his likely beneficial interest in case that interest cannot be disregarded under paragraph 4(b) of schedule 6 of those Regs