Is this deprivation?

[fedupandold]

Hi, a friend of mine has two sons (32 & 35). One of them won a substantial (£75,000) amount of money in the past couple of months. He has no real need of this money so has decided to share it amongst his brother and his dad & mum.

He has decided to give his dad (my friend) & mum £!5,000 and his brother £15,000 leaving him with £45,000 which he is using to buy a new camper van.

 

Now his dad & mum are retired and receive a total of £461 every 4 weeks from the Pension Service as Guaranteed Pension Credit. My friend has some savings but they are just under the £10,000 limit. If he takes the £15,000 they will jump up to just under £25,000.

 

This will mean he will have deductions made from the Pension Credit of approx. £30 a week.

 

I'm trying to show him how this will work out. Does it mean that his total savings will go down by £30 a week so that it will take years (approx 10) before they get back to just under £10,000?

 

If that is the right way of looking at it, there is no real point in accepting the £15,000 as all it will mean is that they will lose £15,000 of benefits over the next 10 years or so?

[antone]

I believe you are assessing the situation correctly. Of course, it may be worth their while accepting the money if they have an expense coming up that needs a lump sum, but as you describe it, they won't be better off long term.

[antone]

Sorry, meant to add - it would also be worth their while accepting the money if they have essential expenses that wouldn't be classed as deprivation. So, for example, if they have essential household repairs, need a new car to replace one that's falling to bits, that sort of thing, then they'd be able to spend some of the money without notional capital being an issue.

[fedupandold]

Sorry, meant to add - it would also be worth their while accepting the money if they have essential expenses that wouldn't be classed as deprivation. So, for example, if they have essential household repairs, need a new car to replace one that's falling to bits, that sort of thing, then they'd be able to spend some of the money without notional capital being an issue.

 

Thanks for the confirmation. It does seem ridiculous that he would have to use the £15,000 to top up their income every week. Still I will tell him what he wants to know, and will probably tell his son to keep the money as it would be of no help to him. On the point of expenses, I will tell him if he could ask his son to hang on to the money just in case it is needed - that would be the wisest thing to do. As for a car he had a Motability one until last year before deciding to give it up as it will be almost unlikely that he will get a PIP award when it comes in. Instead his son has given him his old car - a late 2009 Mercedes 220 diesel sport saloon. A lovely car and I'm a wee bit jealous.

[antone]

No need to be jealous, surely?

[bohomiz]

Hello

 

Can't they just buy a suitcase and stash the cash in it. That's what I do now (although it's a briefcase). Don't trust banks/building societies, or the government come to that. And easy access if need be. Just an idea.

 

BM.

[antone]

Hello

 

Can't they just buy a suitcase and stash the cash in it. That's what I do now (although it's a briefcase). Don't trust banks/building societies, or the government come to that. And easy access if need be. Just an idea.

 

BM.

 

Cash stashed in a suitcase needs to be declared to the DWP.

 

And let's face it, if you don't trust the government then there's no point in stashing your cash underneath the mattress - banknotes are only worth anything because they are backed by the government.

[fedupandold]

No need to be jealous, surely?

 

Ummm - I have to pay for mine!

[fedupandold]

Cash stashed in a suitcase needs to be declared to the DWP.

 

And let's face it, if you don't trust the government then there's no point in stashing your cash underneath the mattress - banknotes are only worth anything because they are backed by the government.

 

I doubt very much that many actually tell the DWP how much money (cash and other valuables) that they have in their homes! I have a German wall clock & matching wall barometer that I inherited a few years back that are in the loft. They were a wedding present to my great grandparents in 1870. In addition I have a box load of table silver, glassware, pictures and oil lamps that date from the late 19th century that came the same way. I have no idea what the value is, they will never be sold but they were never disclosed to the DWP. How many actually count up the cash they have in their pockets/wallet etc?

[caro]

Your friend is very lucky to have a choice of whether to accept a large gift or continue to take advantage of benefits while so many in dire need are having theirs cut due to the current economy. Many don't have family to help them and even DWP just advise them to go to food banks, although how that helps pay essential bills is quite beyond me.

 

Maybe your friend should contact DWP for their advice to make sure that he doesn't accidentally claim money he's not entitled to, or even worse find himself accused of fraudulently claiming benefits he's not entitled to by rejecting his son's gift.

[bohomiz]

Hello

 

Can't they just buy a suitcase and stash the cash in it. That's what I do now (although it's a briefcase). Don't trust banks/building societies, or the government come to that. And easy access if need be. Just an idea.

 

BM.

 

 

What the eye doesn't see the heart won't grieve over.

[stu007]

@bohomiz CAG cannot support the course of action that you have suggested to the OP.

 

Can you please refrain from such Comments in future.

[antone]

I doubt very much that many actually tell the DWP how much money (cash and other valuables) that they have in their homes! I have a German wall clock & matching wall barometer that I inherited a few years back that are in the loft. They were a wedding present to my great grandparents in 1870. In addition I have a box load of table silver, glassware, pictures and oil lamps that date from the late 19th century that came the same way. I have no idea what the value is, they will never be sold but they were never disclosed to the DWP. How many actually count up the cash they have in their pockets/wallet etc?

 

Er...personal possessions are not considered. You can have as many expensive clocks and as much silverware as you like and it won't affect your benefits.

[fedupandold]

Er...personal possessions are not considered. You can have as many expensive clocks and as much silverware as you like and it won't affect your benefits.

 

That is very interesting to know. So instead of taking the cash, are you saying that it would be OK for him to be given say another valuable asset instead? Maybe gold sovereigns?

[bio]

Ummm - I have to pay for mine!

 

I thought the taxpayers were paying for it?

[Minibits]

Well, we are all taxpayers from the day our parents register our birth, but some of us are so *lucky* that we don't have enough income to pay any tax... apart from VAT, Council Tax etc.

[san_d]

Cash stashed in a suitcase needs to be declared to the DWP.

What about gold coins? I have seen on another forum it can be declared as personal possession. And if it's Gold Britannia it's exempt from capital gain tax.

[antone]

What about gold coins? I have seen on another forum it can be declared as personal possession. And if it's Gold Britannia it's exempt from capital gain tax.

 

Don't know about gold coins, I'm afraid. The meaning of "personal possessions" from a capital point of view is generally the normal, everyday meaning - it's meant to ensure that you don't have to sell your bed, sofa, cutlery and TV. A stack of gold coins certainly violates the spirit of this exception, but I don't know about the letter.

[caro]

Many people would prefer to sell their valuables and stay off the benefit system given a choice, while it seems that others are happy to maximise what they can get.

 

As Antone says, it violates the spirit of the system, and gives those in genuine need a bad name when some will try and work the system to their own advantage.

 

I don't think too surviving on £70 a week are surrounded by silver or have gold coins tucked away.

[antone]

Ummm - I have to pay for mine!

 

Fair enough. Is there a sudden glut of Merc 220s? I could do with replacing my 10 year old Peugeot 206.

[Nystagmite]

Thanks for the confirmation. It does seem ridiculous that he would have to use the £15,000 to top up their income every week.

 

Why is it ridiculous? Benefits are for those who need them.

[fedupandold]

I thought the taxpayers were paying for it?

 

No I am paying for it out of the money that the government give me in recognition of my disabilities.

[fedupandold]

Fair enough. Is there a sudden glut of Merc 220s? I could do with replacing my 10 year old Peugeot 206.

 

Yes it seems so. The new model has just come out and many are part ex'ng their old one for the new more efficient, less costly model.

Even Vauxhall have entered the arena with a completely restyled, improved and updated new Insignia as well as shaving off over £2000 of the price. That will result in a reduction in price of a second hand 2/3 year old model and a glut of motors!

[fedupandold]

Fair enough. Is there a sudden glut of Merc 220s? I could do with replacing my 10 year old Peugeot 206.

 

10 year old??? I've never driven a car that old. I'd be too afraid of the thing breaking down right left and centre.

[fedupandold]

Why is it ridiculous? Benefits are for those who need them.

 

Personally, I don't see why it is wrong to view it in the way, it is a gift that will only end up in the hands of the government by restricting the benefit payments.