I understand that if a client with an assessed income period on guarantee credit moves from their own home to rented accomodation and sells their house then the capital from the sale of the house is disregarded during the AIP, thus ensuring they still get full H.B.
However, what I`m not clear about is whether or not there is a requirement for the client to put their former property up for sale during the A.I.P if they don`t want to? As things used to be before A.I.P`S a client would not have had H.B. unless their former property was up for sale, but as the capital is disregarded anyway should it make a difference?

Chapter & verse is in the new version of reg 22 of the HB General Regs, as introduced by the HB & CTB (State Pension Credit) Regs 2003. For people getting PC Guarantee this says, quite simply, that their income and capital is wholly disregarded.

So, if PC Guarantee remains payable for the remainder of the AIP, whatever the new capital position, that's it for HB/CTB - full entitlement. As for PC(G), it doesn't matter whether the former asset is up for sale or not, during the AIP; if not, the claimant has a non-liquid asset instead of a liquid one. It's a new capital asset, sold or not, and disregarded till the next AIP. Indeed, it seems to me that income from such a disregarded asset is also disregarded in these circumstances, so the smart thing to do if you're not selling up is to get a tenant in there! Am I right, colleagues?

Jim

I think you are right. Rental income is not on the list of income that counts, so the claimant could enjoy this income stream without effect on PC. Chickens only come home to roost at the end of the AIP, when capital is re-assessed.

So its a good strategy for Guarantee Credit claimants. The downside I suppose is for those people who would only be able to access Savings Credit if the income was counted, but I imagine these will be few and far between.

Steve

Thanks very much for the above replies.
Does anyone have any experience of clients who have rented out a former property? I can see the logic of the above comments but wonder how the Pension Service would deal with it in practice i.e. as not many people would have done this yet would they make a mistake and count the income from the rent?

Yes I have a client who has an AIP till 2010, but due to ill health moved nearer family to private rent and rented out her home. Guess what! The PS took away her PC and AIP, and counted the rent from her former home as weekly income. We challenged and they said that they always treat rent as income - ha ha. Needless to say an appeal has been lodged.

Call me a cynic but I suspect that they will supersede the award and an appeal would be necessary. I do hope I'm wrong though!