AIBU? Hiding money to obtain benefits.

foxie48

It's quite legal to vary a will so that money passes to a different person, lots of people do it. People do all sorts of things (some legal some not) to avoid paying out their own money or leaving themselves better off in some way. I don't condone dishonesty but without knowing the circumstances I try not to be judgemental. I also can't help thinking that the rich avoid paying their taxes quite legitimately by setting up trusts, keeping money offshore, passing cash onto to their heirs whilst alive etc so a single woman passing on her dad's inheritance to the grandson so she can scrape by on benefits for the rest of her life doesn't seem like a hanging offence!

I am not saying that benefit fraud is acceptable, but as long as the better off pay financial advisors to maximise their tax position (eg having one of a couple pass their tax allowance to the other), I can't get too het up about someone being a bit better off because of an inheritance. Taking money back £ for £ from someone who has had a small inheritance seems to me spiteful - it is keeping people in poverty, and is effectively also penalising the person who left the money to improve the life of their relative.

I would feel different if the amounts were life changing, which is why I asked how much was involved.

There are legal means of avoiding income tax on property rentals but they’re complex. If someone is simply pocketing rent and not declaring it, they can be found out. HMRC, like the police but unlike the general public, have access to a list of property owners in England and Wales maintained by the Land Registry and the properties those people own. Local authorities and utility companies also have records. People might get away with it for a while but their affairs are not so far beneath the radar as they might think.

Surely people requiring personal care due to a physical condition which can be fir years get it without question,
A brain disease which can attack anyone, old or young, requires similar support.
Until the 60/70s people with dementia were in long term nhs hospital wards, then councils took over and in the 80 s these were sold to private companies. As was the domiciliary care.

The owners of my mothers home, together with their children, all drove luxury cars with frequent exotic holidays. At up to £2000 per week there has to be profit in that.

foxie Yes, it is lega to do a deed of arrangement to redistribute money in a will, but you are still up against the rule that says, if you dispose of money by legal or illegal means with the intention of avoiding paying care home fees or to qualify for a benefit or keep receiving it, then the Local Authority and DSS has the right, in fact, legal obligation, to take account of the money you have reassigned by the Deed of Arraanegment when calculating what help with care fees or benefits you will receive.

When I worked as Home Advisor with Age Concern (as was) I visited a number of people who had come up with all sorts of wicked wheezes (they thought) to avoid paying care costs or to qualify for benefits. Some of them thought up by solicitors. None of them worked. Sooner or later they got caught up with and would come rushing to Age Concern looking forways out. We had to tell them that there were none. And if they died I think the money can be claimed back from their estate or those to whom the money is given.

Personally, given the quality of care home an LA will put you in, I would rather my whole estate was expended caring for me so that I could go into a home, not bumping along at the bottom of the market. Yes, of course, I would like my children and grandchildren to inherit my money and house, but by owning a house it means they have had a childhood free from poverty, gone to good schools, had better chances of good tertiary education, so why neither of them is rich, they too own houses and their children are having a culturally rich childhood, go to good schools and will have a head start when going to university. That in itself is a huge inheritance for my children and grandchildren to receive.

Talking of tax evasion, I’m convinced that plenty of landlords don’t declare their rental income.

A friend of a dd, a doctor, who moved to dd’s area and rented out her London flat, was genuinely shocked to be told by a married couple (both doctors) that she was ‘mad’ to be declaring her rental income. ‘We never have!’

If you don’t have a mortgage and don’t use a letting agent, in many areas of the country there is nobody you are legally obliged to tell that you are letting a property.

Even the HMRC self assessment form doesn’t ask for addresses, just ‘how many properties’.

All too easy to fiddle.

I think, Lucky, that Allsorts is saying that her friend wasn't incapacitated as she had claimed, and was claiming benefits fraudulently - hence the friendship ended when Allsorts found out the truth.

Allsorts

I had my closest friend who falling at work, claimed Incapacity benefit as she could not walk without excruciating pain at the age of 48. She collected the benefit for years without me knowing that, I thought she retired early because she could afford to. The friendship ended you never really know with people.

What the heck? This is what benefits are for, and she legitimately claimed. What is your problem?

What would you live on if an injury incapacitated you and made it impossible to work?

silverlining48

It isn’t right Kitty. Dementia is a brain disease which can happen to anyone and should be considered as a medical condition because that is what it is.

The trouble, as things stand, is that unlike most diseases, the care needed for dementia is largely social, not medical - general supervision, help with eating, drinking, washing, getting dressed - and ‘toileting’ as they like to call it.

And such care can be needed for many years. I know she was unusual, but my mother, who showed the first signs of dementia at IIRC 81, was in a (self funded) care home from 89 until she died at 97.

I’m not saying it’s right that dementia-care should not be govt. funded, but the cost would be colossal. And TBH we were grateful for the self-funded option - able to choose the time and place without having to rely on the tender mercies of invariably hard-pressed social services.

If you are wealthy tax evasion is not a good idea because if you are caught the penalties are severe, a tax investigation is a big deal and very costly, then you get a penalty several times the amount in question.

But she hasn’t passed it on - he’s sheltering it for her. It’s still hers.

Germanshepherdsmum

Some people guilty of large scale tax evasion are caught by very minor errors. I can’t tell you any details of cases I know of for obvious reasons, but believe me it happens. HMRC catch far more tax evaders than you might think. Slowly slowly catchee monkey works well.

Glad to hear it!

It's quite legal to vary a will so that money passes to a different person, lots of people do it. People do all sorts of things (some legal some not) to avoid paying out their own money or leaving themselves better off in some way. I don't condone dishonesty but without knowing the circumstances I try not to be judgemental. I also can't help thinking that the rich avoid paying their taxes quite legitimately by setting up trusts, keeping money offshore, passing cash onto to their heirs whilst alive etc so a single woman passing on her dad's inheritance to the grandson so she can scrape by on benefits for the rest of her life doesn't seem like a hanging offence!

Katie59

“Some tax evasion is easier than you think too. I'm sure Jacob Rees-Mogg could give you some tips.”

I’m sure his tax affairs are squeaky clean, avoidance, yes, evasion no. You may not agree with the rules but they are there and the Government can and do change them all the time, I would not expect a Labour government to change much because taxes are already quite high.

They're not high if you avoid paying them. It's the distribution of taxes which matters.

Some people guilty of large scale tax evasion are caught by very minor errors. I can’t tell you any details of cases I know of for obvious reasons, but believe me it happens. HMRC catch far more tax evaders than you might think. Slowly slowly catchee monkey works well.

OP here In reply to Joseanne I rather hope the son does have other ideas, he is a committed weed smoker and I suspect a small time drug dealer, he does have a job though.

My friend has spent most of her life on benefits and is lucky to have a housing association flat in London, she has lived there 30+ years and it can pass on to her son.
She has illegally sub let rooms in the flat for many years.

She has only worked for the past 10 years or so, prior to that she claimed benefits and cleaned houses on the side.

She has been ill and had treatment but is now fine, she had a year off sick from work and then took VR.
She is going to see the doctor and say her anxiety levels are high, she is confident she will be signed off as too ill to work.

She thinks myself and my husband are out and out capitalists!
She was a staunch Corbin supporter.
She has very little idea how hard we have worked to own our home and raise 3 children.

By her own admittance she is inherently lazy.

My mind is made up!

My now ex friend!

I will not report her as it will obvious, I did however report someone years ago who was claiming thousands a year under false pretences.

“Some tax evasion is easier than you think too. I'm sure Jacob Rees-Mogg could give you some tips.”

I’m sure his tax affairs are squeaky clean, avoidance, yes, evasion no. You may not agree with the rules but they are there and the Government can and do change them all the time, I would not expect a Labour government to change much because taxes are already quite high.

Thanks Katie but I do know the difference
Would question that ‘everything is online’ so checkable though wish that were the case. ,

speaking to a family member with her mum now in a nice care home, self funded £6000 per month. Very much nicer than the state funded place that another person got. Her money won`t last that long but at least for now, she is happy. Swings and roundabouts re `hiding` savings for benefits. No-one thinks they will get old

you can `hide` money in several ways, buy things, hang onto them for a while and then give them to AC. Upgrade your home as much as possible, beyond what it needs. Keep cash and give small handouts to AC and DGC ie slowly reduce the amount you have in savings

Katie59

silverlining48

It’s my understanding that tax and many other ways of evasion by the wealthy far outweigh benefit fraud by the poor.
Both are wrong but it’s a scandal the wealthy seem to get away with it.

Please distinguish tax avoidance which is legal and proper from tax evasion which is illegal. It’s not easy to “evade” tax these days because everything is online and easy to trace.

Avoidance, is where you set money aside for the future, life insurance, pensions, gifts, an ISA is tax avoidance, the revenue allow you to do that

HMRC could, if it wanted, clamp down on tax avoidance very easily. It won't because the government is frightened of losing votes. Some legal tax avoidance is, in my opinion, wrong eg. the fact that high earners receive a higher "subsidy" for pension contributions than basic rate tax payers.

Some tax evasion is easier than you think too. I'm sure Jacob Rees-Mogg could give you some tips.

I think this type of avoidance is despicable and I am disillusioned with how many get away with it. MiL decided to give away the proceeds from her house sale and her savings to her favourite DD and then went on to claim benefits. My DH tried to report it but no one was interested in following things up. The care home she was in was, however, very quick to ask us to be lifetime guarantors for her and cough up an additional £500 a month!
The DD frittered all the money and abandoned her mother, so the OP's friend had better be aware of what can happen if the son has other ideas.

VioletSky

I agree Blondiescot I speak to so many parents transitioning back to work after children and so many are worse off working it is a bit soul destroying

Its all so broken

Its all so broken

It is, and has been for decades.

And as long as we have a FPTP electoral system, it will continue to be.

Various studies and polls indicate that the majority of voters do not support this government, yet it's almost a certainty that they will win the next election.

All it needs is a few more outraged headlines in the tabloids highlighting individual benefit claimants with gazillions of children, alternating with those about the number of "illegal" immigrants landing on our shores, mixed with a vinegary bit of rhetoric about the 'nasty' EU 'punishing' us because we won't stick to the deal we signed... and they'll be home and dry.

silverlining48

It’s my understanding that tax and many other ways of evasion by the wealthy far outweigh benefit fraud by the poor.
Both are wrong but it’s a scandal the wealthy seem to get away with it.

Please distinguish tax avoidance which is legal and proper from tax evasion which is illegal. It’s not easy to “evade” tax these days because everything is online and easy to trace.

Avoidance, is where you set money aside for the future, life insurance, pensions, gifts, an ISA is tax avoidance, the revenue allow you to do that

MissAdventure

No idea.
None of my friends are in that position.
The ones on benefits absolutely need them.

That's probably because benefit fraud, though widely publicised by the gutter press, is in reality comparatively low.

And it really does grate that some of those pontificating politicians who wade into the issue belong to a party that is supported by backers and donors who are quite adept at rigging the system to avoid paying tax.

On a personal level, the whole rigmarole of claiming, filling in endless forms (with loaded questions) must be driving you to despair.

It’s my understanding that tax and many other ways of evasion by the wealthy far outweigh benefit fraud by the poor.
Both are wrong but it’s a scandal the wealthy seem to get away with it.