Private Pension and Housing Benefit

Hi all,

I am looking into capital disregard of self invested private pensions (SIPP) within Housing Benefit Regulations and guidance and wondering if the housing benefit definition on “private pension” is wider than the DWP definition.  Any ideas rightsnetters?

HB Regs Schedule 6 paragraph 32 - The value of any funds held under a private pension scheme is disregarded indefinitely.

IS Regs Schedule 10 paragraph 23a - says same thing as HB Regs.

Distinction between the two is that in DWP DMG (29428) it qualifies the definition of what is a private pension as a private pension within s1 Pensions Act 1993.

“Private pension” or SIPP does not appear to be defined in HB Regs or Guidance notes (“BW1”). 

The reason I ask, is we are advising a client on his rights of appeal for HB only. He saved capital each year in an ISA (in excess of 30k).  He saved if for the purpose of his SIPP and has not ever withdrawn anything.  He claims it is for his pension and given he is bordering 60 yrs old it does seem reasonable.

Issue is he claimed HB a few years ago believing his savings in his ISA would be disregarded as a SIPP, therefore did not declare them and now has an o/p worth 60k. 

Wondering if it would be viable, for a benefit tribunal, to equate an ISA with a Self Invested Private Pension (SIPP). 

Any thoughts, experience, ideas welcome

There is a definition of “private pension scheme” in HB Reg 2:

(a) a personal pension scheme as defined by section 1 of the Pension Schemes Act 1993;
(b) an annuity contract or trust scheme approved under section 620 or 621 of the Income and Corporation Taxes Act 1988 or a substituted contract within the meaning of section 622(3) of that Act which is treated as having become a registered pension scheme by virtue of paragraph 1(1)(f) of Schedule 36 to the Finance Act 2004;
(c) a personal pension scheme approved under Chapter 4 of Part 14 of the Income and Corporation Taxes Act 1988 which is treated as having become a registered pension scheme by virtue of paragraph 1(1)(g) of Schedule 36 to the Finance Act 2004;

Even a SIPP is subject to some governance - there has to be a trustee who ensures that investments are within the tax relief rules.  I don’t think you can just retrospectively rebadge a savings account as a SIPP.

However, if the total value of the ISA is £30,000 (is that right - or was if £30k invested each year?) there cannot possibly be an HB overpayment of £60,000.  The diminishing capital rule should mean that the overpayment cannot be any more than £24,000 max, and in practice not much more than £14,000.  Was there other declared capital in addition to the ISA?

Thanks HB

Thats what happens when you overlook all the regs.
Client started with 30k which rapidly increased to 60k so diminishing is a no goer. 
No declared capital.