Clients live in England have children (all children have major health/disability issues) one partner on IB the other at university. IB claimant claims IS for family. IB was on ½ pay prior to July 2004

Clients sold their home (in England circa May 2004). Capital (approx. £70k) was held by their solicitor in respect of a property they intended to buy in Scotland.
Offer made on Scottish property July 2004, accepted within days. Clients have advised me that under Scottish law money was held by solicitor and they never had any access to it, transferred to seller, on completion, September 2004. Clients now have a mortgage for this property.

At about the same time as offer and transfer of capital to their solicitor took place (July 2004) Clients applied for and were granted IS, HB & CTB. They did not advise DSS of any large capital as they considered that the £70k was in transit (so to speak) between the solicitors acting for both them and the seller.

When they originally started the move to purchase the IB claimant was working full time and expected to be fit and able, now unlikely to work for some time, if indeed ever again.

I have advised clients that: A property which needs essential repairs and alterations so that the client can live in it as her/his home can be disregarded to allow the repairs and alterations to be done and the client to move in. The value of the property can be disregarded for up to 26 weeks (or longer if this is reasonable) from the date the client first takes steps to get the property repaired or altered.

However, clients have advised me that they are not in a position to commence alterations (the property is in need of repair) due to:
1) One partner at English university for next 2/3 years.
2) Have not the funds at the moment to commence work on Scottish home. Could be 3 years before they are able to commence.

Sorry if this is drawn out, but have they falling foul with the DSS for not declaring the £70k?

money from the sale of a property earmarked for the purchase of a home can be disregarded for 6 months (or longer where reasonable), so they haven't _necessarily_ fallen foul of the law, which is a different thing to falling foul of the DSS. much depends on your client's intentions at the time, and it may be that they have changed their plans since their circumstances have changed.

i suspect your client's may face difficulties around the university course, and you may have problems persuading the DWP to disregard for property repairs if there is no intention to occupy the property within 3 years. there may also be a problem with disregarding the capital held by the solicitor if the DWP is not convinced there was an intention to purchase a home.

the disregards apply to property intended to be the home, otherwise it is just property and the normal capital rules apply. i would expect the DWP might regard enrolling on a 3 year course in england as evidence that the property purchase in scotland was not intended to be the home. how arguable your client's case is will depend on the facts.

jj