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Forum Home  →  Discussion  →  Income support, JSA and tax credits  →  Thread

Capital deprivation and Income Support

Darren
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Welfare benefits - Disability Law Service, London

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Hiya,

My client currently gets Income Support. Her dad died a few months ago and the will stipulates the house is to be sold and client is due to receive an inheritance of £60,000 (house has now been sold). My client wants to give this capital to her daughter to help her buy a house. Is there any way my client can do this and avoid the deprivation of capital rules? Her brother is the executor of the will. I assume even if her brother paid the client’s £60,000 directly to the client’s daughter, the client would still need to declare to IS that she is / was the beneficial owner of this capital and this could stop her benefit and be treated as notional income? Or would the client be okay if the money never goes into her bank account?

Thanks!

 

[ Edited: 19 Jul 2022 at 10:22 am by Darren ]
Elliot Kent
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Shelter

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Your client is entitled to the money and if she were to give it away this would amount to deprivation of capital. If a desire to keep her income support is a significant operative purpose of doing so then she is going to be stuck with notional capital.

Whilst it is not helpful now, whilst the father were alive he could have amended his will so that the funds went to his granddaughter instead.

Darren
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Welfare benefits - Disability Law Service, London

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Ah, I was afraid that was the case, thanks for clarifying!

Gareth Morgan
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CEO, Ferret, Cardiff

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Elliot Kent - 05 January 2021 06:29 PM

Your client is entitled to the money and if she were to give it away this would amount to deprivation of capital.

What about a deed of variation?

Ianb
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Macmillan benefits team, Citizens Advice Bristol

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Gareth Morgan - 07 January 2021 12:24 PM
Elliot Kent - 05 January 2021 06:29 PM

Your client is entitled to the money and if she were to give it away this would amount to deprivation of capital.

What about a deed of variation?

I don’t think that works. Although a deed of variation ‘rewrites history’ in respect of inheritance law I don’t think it does for benefits. By choosing to make a deed of variation she is depriving herself of capital that is currently hers by right.