Recently had something very similar. Client came to us having lost an appeal against a decision that she had very large amount of capital. Well out of time for appealling to Commissioner, and no real grounds for doing so in any case.
We put in a fresh IS claim, which was refused, and then appealed. We ran the case on the basis we needed to account for all the capital, right back to the date it was first received. I think this has to be right, since my client had £150,000 in mid 2000, and clearly needs to explain why she now has no capital.
DWP applied a dimishing capital calculation to the capital identified at the first appeal, which accepted she'd accounted for £50,000. At hearing of second appeal, chair commented that this was clearly wrong, as this was actual capital, not notional. Still awaiting a decision from the tribunal, but they clearly accepted that we could provide evidence that the capital had been spent by the time of the first IS refusal.There would be no entitlement to benefit before the second claim, but all the evidence we had, and most of it was simply the client's statements, showed that the capital had been spent very quickly after it was received.
I think you need to account for all the capital, whenever it was spent. The claimant isn't necessarily fixed with what the first tribunal decided.
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