AIBU? Hiding money to obtain benefits.

Plunger yet again, if you enter a Deed of Arrangement to avoid care fees. IT WILL NOT WORK.

I do not know how many times it has been said on this thread. Trusts, Deeds of Arrangements, Gifts etc. If any of these is done with the intention of avoiding care fees, a Local Authority will simply ignore them and calculate how much help you will get, if any, on the assumption that that money is still available to be spent on your care.

Can no one see that if any of these wizard wheezes worked, respectable solicitors, Money gurus, Newspaper Advice lines etc etc would all be advising people to enter into them. They do not because they know that when the flak hits the fan they are worthless. Because the LA will act as if you still have that money at your disposal.

nadateturbe

I could understand people giving children money now rather than having to pay inheritance tax. But not to claim benefits. That's just wrong, illegal and greedy.

Your message sums up what is wrong with this country. It’s fine for RICH people to dodge inheritance tax, oh that’s perfectly acceptable. But a benefit cheat should be locked up for life or get the death penalty.

Buttonjugs I completely agree with you. Most people naturally want to help their children. Bu t there are many entirely legal way that money can be given to children. Cheating inheritance tax, is just as heinous as claiming benefits when you are not entitled for them

Sago - what your 'friend' has done is not against the law. If she has genuinely 'given' the money she inherited to her son then there's no fraud involved and provided she doesn't die within seven years of making the gift he won't have to pay tax on the amount.
However, if she has given her son the money to hide for her, with the agreement that really it's still hers to do with as she wishes (i.e. world cruise, new fox fur for the winter), then she is committing fraud and her son is aiding and abetting her and he too is guilty of a crime.
You need to be sure of the precise arrangement she has made and then if you feel she is defrauding the system you have the choice as to whether to report her or not.
Personally I hate benefit fraud but it does seem to be common. When my mother had carers (we lived together), those carers often said that they were told by the agency that she contributed financially to her care and that she was unusual in that respect. Generally the carers were visiting elderly people in social housing who didn't pay yet according to the carers, there were Mercedes, BMW or 4 x 4 vehicles in their driveways belonging to an adult (working) child and the carers themselves drew their own conclusions. It often crossed my mind that my mother's life choices (to work and save) had penalised her in her later years as people living in households where there was a lot more disposable income than in ours were effectively being funded by my mother and those like her. I did however eventually come to the view that it wasn't healthy to think that way, and opted to believe that as long as we weren't defrauding the system that was enough for me to think about.

I know there are some pensioners in poverty - I'm one of them, by the way. I'm talking about averages. There are about 11 million pensioners in the UK. About 2 million of them are living within the official definition of poverty, but the other 9 million are not. Official figures show that the average pensioner is better off (income and wealth) than the average working age family with children after housing costs. Please note that I'm talking about averages. What really annoys me is that pensioners complain about pensions and when they get something, they seem to forget everybody else or, even worse, they blame everybody else for their own poverty and relate endless tales about how bad life was in the past. It's how identity politics works. Buy off one group - in this case pensioners - with reinstatement of the triple lock and £500 Winter Fuel Allowance - and then say giving anybody else a bit extra would be inflationary. It's nonsensical economics, but it keeps core voters happy. I would prefer state help to be based on income/wealth not on age, but that doesn't suit the government because it wouldn't be able to create division and curry favour with one demographic - and I'm sure everybody's seen pictures of elderly hands counting out pennies in stock photos and felt sorry.

Here we go again.

Are the 9 million pensioners not in poverty claiming benefits? If not (and I'm guessing they aren't, as claiming is difficult enough for those seeking work) what has their financial situation got to do with benefits? Would you rather see them in poverty?

When it comes to top-up benefits, working people (or non-working people for that matter) and pensioners should be given the same consideration, with stage of life taken into account (eg money for children's activities or a need to have heating on all day). Equality is not always equitable.

When it comes to the basic pensions that people have paid for, however, there is nothing to be gained by setting one generation against another, nor by spitefully taking away money from older people when it is too late for them to adapt to having their financial expectations changed, even if you happen to think that expectations of a life above the poverty level are too high.

Some people earn more than others, and some people have more income in retirement than others. Unless you are advocating a communist society (in which case there are a lot of other things that would need to be changed too), then that is a fact of life. Would you take a state pension from someone who has paid in all their lives because their partner earns above what you consider a reasonable amount for an older household to live on? I would prefer to see all younger adults who can paying in and all older people getting out, so that everyone keeps their financial independence.

Some people having more than the basic pension doesn't mean that they are grasping or 'entitled', and it absolutely needn't mean that younger people should get less. The budgets are (or should be) separate, and if they have been badly managed, that is the fault of the government(s), and it is their responsibility to put it right, or to mitigate their bad management.

IMO, it is setting pensioners against other generations that is identity politics, and this is stamped through your posts like Blackpool through rock. Whether you like it or not, there is a difference between a basic pension and benefits for working people. Pensions have been bought and paid for (and yes, I know that the system means that it doesn't work exactly like that, but the principle remains). I would very much like to see a rise in benefits for all - working families, the unemployed, the disabled and ill, people on pension credit, anyone who needs it, and have it paid for with a much more progressive tax system - but I do not see that playing one off against the other(s) will ever achieve that.

Not very good carers, to be musing about other service users financial arrangements, then?

I knew of someone who, when they were 29 injured their back at work. That was thirty years ago and they have never worked since. Claimed benefits all those years yet could walk and sit around for hours doing this and that, laying paving, building a fish pond driving for hours in their car. When going to sign on they’d take their walking stick and walk oh so slowly. When the means testing came in they did their best to lay it on thick but it didn’t work and they had their benefits cut drastically but not stopped altogether. Another person I know (early thirties and has never worked) claims PIP living at home with their parents. First thing they do when they get their money is go to the betting shop or pub. The parents claim carers allowance too. It’s not easy reporting someone that you know.

Of course there are people like that.
There are also sweet old dears hiding their money and claiming benefits, too.

GoldenAge,

“Generally the carers were visiting elderly people in social housing who didn't pay yet according to the carers, there were Mercedes, BMW or 4 x 4 vehicles in their driveways belonging to an adult (working) child and the carers themselves drew their own conclusions”

I’d take that with a very large pinch of salt. That statement wouldn’t bear much scrutiny.

It would if they were reported to their company.
Terrible thing to do.

You could report her to the Benefit Fraud line

GoldenAge, you are not correct when you say it is not wrong to give away an inheritance to the son. She needs to inform the DWP. It IS benefit fraud.

I do agree that all benefits should be increased, however.

It's amazing, the lengths people will go to in order to make what they do ok, along with the lengths they will to make it not ok for people they think they are better than.

Many people have been caught with benefit fraud. I personally worked with a senior social worker who continued claiming benefits 6 years after getting the job. She was arrested in our office and served 9 months in prison, first offence no previous convictions. None of our office staff knew and were all shocked.
Loose lips sink ships too as someone my brother knew moved in with a married couple and had an affair with the wife. The husband "moved out" A year later the boyfriend was in a pub and "jokingly" said husband was burried under the patio when someone asked where he went as they hadn't heard from him. Someone in the pub told the police. Police dug up the patio when they couldn't trace him and family hadn't heard from him. He actually was murdered and burried under the patio in their garden. Was in all the local papers too so I know my brother was telling the truth not one of his tall stories.

It's not a good idea if it is deliberate deprivation of assets to avoid tax and presumably the same with benefits.

It's fraud.
Plain and simple, however it's dressed up.
She has given the money for her son to keep it out of her accounts in order to claim benefits.

It's certainly legal to pass an inheritance to someone else assuming the deceased left a valid will. I did it when my dad died. There was no inheritance tax to pay so I made a deed of variation and submitted it to the executor. You don't need a solicitor and the process is explained on the government website. If I hadn't done that, my sons could have been liable for tax, although if it had been a gift, I've survived the requisite seven years.

I used to be involved in assessing people's assets for care. Examined bank accounts spending records, income, you name it, it can be examined. DWP should be looking at all of these eg low income, hiw much are tgey soending, do they run a car, cost of phone/tv subscriptions. If course your friend may have a totally isolated account but unless she never uses any if the funds, spending any of it will reflect on lifestyle. It's criminal what they are doing. They have finds so any loss of benefits probably won't affect them. Up to you whether you report or not.

Your entitlement to receive a legacy is an asset. A will can be varied so as to pass the legacy to someone else. You are however deliberately depriving yourself of an asset where benefits or care costs are concerned.

It's fraud and theft, and I would take a very dim view of this behaviour.
On the other hand, our present government also seem to think that taxpayers money is there for them to plunder as they will, which again is fraud and theft, yet they escape prosecution time after time.
Many wrongs don't make a right, of course, but I'm beginning to find society in general completely intolerable.

Lizzypopbottle, there is no gift tax in the UK, so the sons would not be liable. It is the estate which pays IHT before assets are distributed, but there are legitimate ways round it, eg, as you say, a Deed of Variation.
This will not work with DWP however.

growstuff

Delila

This excludes housing costs as the recipient is entitled to housing benefit and council tax support.

Which is considerably more than a single person of working age would receive in the same circumstances.

of course it is because it needs to be.
who is going to employ an elderly person when they can have the pick of younger ones.
older people, even of working age, have much less prospect of obtaining gainful employment.
i know whereof i speak.
we are not all rolling about in luxury.

Anyone thought that you pay tax on what you earn to buy a house. Then when you die tax is claimed again from the same money that bought the house in inheritance tax. And if you gift money you have earned and saved and die before 7 years that's taxed again too. Just a thought.

The thought has doubtless crossed many minds many times.

In this kind of situation, it’s reasonable to buy capital items that need replacing or which you need, to bring it down to under £8k. Things like carpets, washing machine, new bed, new sofa, new television. Things you couldn’t normally afford.

Get advice from CAB about giving money to an adult child re benefits. This could also be considered reasonable.