SE UC claims - money set aside to pay tax no longer counted towards capital limit

Just passing on in case anyone hasn’t seen: seems that money set aside to pay tax is no longer counted towards capital limit for SE UC claims

From: Clark Sam DWP PRESS OFFICE <SAM.CLARK1@dwp.gov.uk>
Sent: 14 April 2020 15:50
To: Eesha Mohindra <Eesha.Mohindra@moneysavingexpert.com>
Subject: [E] RE: Self-employed & Universal creditA DWP spokesperson said:“Most commonly, we would 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 that is to be used for business purposes, it will not be counted towards their capital, but they may be asked to prove that the money is for business purposes.“People should make clear in their application the savings that are business assets, and note it in their online journal.”
Sam Clark |Chief Press Officer | Department for Work and Pensions
Caxton House, Tothill Street, London SW1H 9NA

Any money over £6,000 is now intended for future tax bills, seems sensible.

Apparently it is based on https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/864939/admh2.pdf

H2022 says: H2022   Business assets include standard items such as machinery, vehicles, fixtures and cash held in the bank (including money held following the sale of assets). They may also include items such as customer lists and contacts, current and future contracts and goodwill

I think it raises more questions than it answers.

Victoria

More discussion here

Well if DWP are happy to see it that way and it is even enshrined in the ADM guidance, I think “don’t look a gift horse in the mouth” is the mot juste.

Everyone should open a business account and keep their savings in there!

Yes the £150k in my ISA is just there to meet my future tax bills, honest guv.

Blimey, you get paid well Elliot, lend us a tenner mate?

Sorry Paul, its all earmarked for the tax man. I couldn’t possibly.

Showing my age, this makes me think of the Mel Smith and Griff Rhys Jones building society adverts:

Paul - “I need a huge favour, can you possible lend me a tenner”
Elliiot - “I’m really sorry, I cannot. I need it all for my tax bill”
Paul - “It’s just that I heard you had one of those accounts where you can withdraw some of the money without an interest penalty and then top it up again later, if say you wanted to help out a mate in an emergency?”
Elliot - “No, no - you must have made a mistake”
Paul - “I certainly made a mistake asking you”

in today’s evidence session before the Work and Pensions Committee, Will Quince confirmed that money set aside for tax liability won’t count as capital - https://www.rightsnet.org.uk/welfare-rights/news/item/treatment-of-income-and-savings-for-self-employed-people-claiming-universal-credit