Self employed, universal credit and savings

@MartinSLewis reporting that:

CONFIRMED pls share. Self employeds who’ve (rightly) put savings aside to pay tax, can ask this ISNT counted within their total savings on Uni Credit appl’tions (UC’s reduced if savings £6k+, stops if £16k+)

https://twitter.com/MartinSLewis/status/1250079251434549249

More from Martin Lewis:

I discussed it with the Department for Work & Pensions, and we clarified a much better route. This is the written confirmation from a spokesperson, just confirmed:

“Most commonly, we’d expect people to have business assets in a business account, including savings for tax liability, which would not be counted towards their capital limit.”

“However, if someone has money in their personal account to be used for business purposes, it won’t be counted towards their capital, but they may be asked to prove that the money is for business purposes.”

To translate: if you’ve got savings to pay tax, put a note of this in your online UC journal, and tell them when they call, and it should be discounted from the calculations.

https://www.moneysavingexpert.com/latesttip/#hiya

This is questionable.  The DWP spokesperson seems to share the common misconception that you can avoid having your savings taken into account for means tested benefits simply by leaving the money in a business account.  That is not what “business assets” means.  Arguably savings that are plausibly ear-marked for certain business-related purposes would be disregarded as business assets - for example you have sold your old van and you are looking for a new one, meanwhile you are hanging onto the money you got for the old one.

Discussed this on Twitter last night with a couple people including Rightsnet regular Charles and the view was that paying some money up front to HMRC as a down payment against anticipated future tax liability would be reasonable and would not be regarded as deprivation (provided the amount is realistic).  But money just sitting in your bank account ()whether it’s a personal account or a business account) is simply your money to use as you wish.