I have an existing owner occupier with some savings, but already getting guarantee credit. They want to purchase a retirement property either outright or through shared ownership.
I have assumed that if they use their existing savings for this (not just equity from sale of current home if any) that this will be classed as deprivation of capital and the savings will still be classed as notional. So their PC will not increase as a result if reduced savings - is this correct?

As they get PC(GC) already, will they then be able to get their housing costs for any service charge, ground rent etc as well? technically this is just reassessing the existing PC claim to take account of different costs, but I am wondering if any additional costs will be excluded as part of a deprivation issue, and their PC will remain unaltered?

I am also wondering if they could now get any guarantee credit towards these new housing costs (provided their income etc now qualifies), even if they didn't qualify for PC(GC) in their previous home?

I am finding the various scenarios a bit confusing!

Thu 10-Sep-09 02:36 PM by Gareth Morgan

What makes you think that they will be treated as depriving themselves of capital in the first place?

It would seem extreme to buy a house in order to acquire entitlement to increased benefit when, if they buy it outright, there will be no such entitlement.

(I'm assuming this will be their only home)

I agree that they wouldn't be buying it to acquire entitlement, and it would be their only home.
My concern was that if they put say 20k of existing savings (not just the equity from their current home), would that then mean more PC(GC) because they now have less savings, or would it stay the same because it was seen as deprivation - ie. they had used the savings and then asked for more PC as a result?

For a leasehold property with a service charge, they could get the housing costs addition for eligible service charges within PC, and again, I don't know if this would be refused. I agree that it shouldn't be!

OK, I understand. I was focussing on SMI.

I wouldn't think it reasonable to treat this as deprivation but YMMV, why not ask the DWP?