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Thread: savings while on ESA CB and IR

  1. #1

    savings while on ESA CB and IR

    Hi I been a long time broswer on here ,and I cant applaude enough for the help and info i have found on this site to fight my pip and sg to wrag tribunals , where I was successful in both .

    However I been asked to pop into a interview with caution in a few weeks about my savings , however I thought "why " as I am on ESA CB ( or so I thought). . I rang the lady at DWP ,and explained the situation ,and she said I started on CB or part of it in 2015 but now im in both , but she couldn't provide dates when I asked.
    BTW im 56 and worked all my life till approx 5 -7 years ago
    Im also in the support group and have just recently been awarded daily living higher rate , and lower limit on disability in pip
    many thanks .

  2. #2
    Senior Member nukecad's Avatar
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    You don't realy ask a question there, but here's a general explanation:

    You can have both CB ESA and IR ESA at the same time, it works like this-

    Your claim obviously started as CB ESA, and so for anytime that you are in Support Group the main part of it will be CB ESA.
    (If it was CB WRAG then that only lasts for 52 weeks at which time you change to IR ESA if you qualify, but it will become CB again if you later get moved up to SG).

    The CB ESA is your Personal Allowance, £73.10, and the Support Group Component, £38.55. (or PA + WRAG component for 52 weeks).
    CB ESA is not affected by any savings/capital or other income. (Except for income from personal pensions).

    You may also have 'Premiums' paid with your ESA, these premiums are only ever Income Related.
    These are affected by savings/capital or any other income.

    In your particular case you should have the Enhanced Disability Premium, £16.80. (known as the Disability Income Guarantee on letters).
    As you have PIP DL then you may also get the Severe Disability Premium, £65.85, provided you live alone and no one is claiming Carers Allowance for looking after you.

    Those figures given are for a single person, for a couples claim some of them would be higher.

    Any savings/capital that you have above £6,000 will reduce the amount of IR ESA payable by £1 for every £250 (or part of) above £6,000.
    Savings/capital of above £16,000 will stop payment of IR ESA altogether.

    So the big question is do you have savings/capital of above £6K?

    If you do and haven't declared it then you may have been overpaid IR ESA and will have to pay back any overpayment.
    They may also apply a £50 'Civil Penalty' as well.

    That's as far as it will go if you've made a genuine mistake and didn't know you should have declared savings above £6k.

    Don't worry too much about the interview being 'Under Caution'.
    That's just standard procedure in instances like this, just in case it later turns out there is some fraud involved somewhere.
    It's the standard PACE caution - "You do not have to say anything when questioned, but it may harm your defence .....".
    (Which if you actually listen/read it is pretty meaningless and just fishing for stuff they don't know - It translates as 'Tell us everything we don't know or we might say that you didn't tell us. If you do tell us something we don't know then that makes our job easier').
    TBH the DWP compliance officers that use it don't know the PACE rules anyway, they just trot it out as a matter of rote. (to try and scare you).
    I don't know everything. - But I'm good at searching for, and finding, stuff.

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  3. #3
    Hi nukecad .Thanks for prompt reply
    Yes in my haste I put the question in the title .I get confused disoriented easily, and normally have help when writing/posting
    At present im receiving £256.90 fortnightly plus PIP.
    I live alone .
    In a recent letter (April 2019) The DWP mention "we will credit you with National insurance contributions while claiming ESA and support allowance" .
    Now im really confused.

    So the question is

    If the assessor is correct and I am now on ESA CB and IR will the rules on savings stand as if I were on IR or CB ?
    Yes, I do have have savings over 6k from 2015, however when I started claiming in the same year I never claimed this ,as ESA CB does not take savings into account
    and if I have been swapped over to both I was unaware of this .

    I was using this post as a guide ,and naturally thought im on ESA CB for the whole claim, I was briefly moved from SG to WRAG but put back into SG after I won my Tribunal appeal. and thought I paid enough national insurance over the years,( 30 plus years before claiming), or have I got it wrong ?

    Would the DWP back date saving penalties to 2015 ?, Im worried now.

    https://www.youreable.com/forums/sho...elated-or-Both
    Many thanks

  4. #4
    Senior Member nukecad's Avatar
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    Not to worry, it does look like you will have to pay some back.

    But it also looks as if they owe you some, because you haven't been claiming everything that you can.

    To start with the NI credits are just a standard thing, you get them with most benefits and they count towards your state pension.
    They are nothing to worry about at all.

    You haven't been 'swapped over' from CB to IR - from the start of your ESA you have had both CB ESA and IR ESA.

    You currently get:
    £73.10 Personal Allowance (CB ESA).
    £38.55 Support Group component (CB ESA).
    £16.80 Enhanced Disability Premium (IR ESA - this is called the 'Disability Income Gaurentee' on letters).

    £128.45 Total (x2 weeks = £256.90)

    While the PA and SG would not be affected by savings over £6k, the EDP would be.

    As I said above they would deduct £1 for every £250 (or part of £250) above £6,000.
    So if you have/had £10,250 or more in savings then they wouldn't pay that £16.80 at all, but the rest would still be payable.
    If that hasn't been happening then you do owe them the money back, and yes right back to 2015.

    (It works both ways, the DWP are currently have to pay people back as far as 2011 because they have been underpaying IR ESA to some people for years).

    We can't realy say how much you will have been overpaid without seeing your savings, and what they have been over the years.
    But see below for a simple example.
    No doubt the DWP will/have asked you for your bank statements so that they can calculate it properly.

    Now what may be the good news:
    Because you are getting PIP Daily Living, your live alone, and if no one is claiming Carers Allowance for looking after you, then you are entitled to another premium which you have not been claiming.

    Its called the Severe Disability Premium, and it's worth an extra £65.85 a week.

    Unless your savings are actually over £16,000 then you can claim this now, and it will be backdated for as long as you had both PIP and ESA together.

    So four more questions if you don't mind:
    1. Are your savings above £16,000 or below £16,000? (Of course they will have changed over time).
    2. When did you start to get PIP? Did you already have it before claiming ESA? (I think you said 'recently'?).
    3. Did you have DLA before that?
    4. Is anyone claiming Carers Allowance for looking after you?


    Hopefuly the answers to those will be OK and we can then tell you how to go about claiming the SDP which (unless your savings are over £16,000) should make up for what they will be deducting for your savings in future.

    To give an example of what you might owe them back.
    Lets say that you had £7,999 savings and that it didn't change.
    That's £1,999 above the £6k threshold, and they deduct £1 for each £250 (or part of).
    1999/250 = 7.996.
    You have to round up (because of that 'part of') so that would be £8 that you had been overpaid each week.

    (If you compare that £8 deduction to the extra £65.85 that you seem to be entitled to but haven't been claiming then it's going to be OK going forward and you should actually end up better off each week than now.
    And if you can agree a repayment plan from your ESA for the overpayment then you may/should still end up better off each week).

    PS. Whatever you do don't spend the savings on a big purchase, give them away, or anything like that to get them below £6K.
    That will be seen as a deliberate attempt to get benefits/more benefits by disposing of saving/asssets.
    It's called 'Deprivation of Capital with a view to claiming or increasing benefits', it's technically fraud, and at the least they can just treat it as if you still had the money anyway.
    (Of course if you used some of it to pay off any overpayment then they couldn't say much about that. EDIT- Wrong, that would be Deprivation too, see post below).
    Last edited by nukecad; 07-20-2019 at 09:01 AM.
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  5. #5
    wow nukecad you really do know your benefits.


    So four more questions if you don't mind:

    Are your savings above £16,000 or below £16,000? (Of course they will have changed over time). ................Yes. just over, some from saving , other from house sale, . £1 for every £250 is a lot of back pay , ouch!!!!!!

    When did you start to get PIP? Did you already have it before claiming ESA? (I think you said 'recently'?)..... I was.Awarded PIP 3 weeks ago , backdated to 26th Feb 2018

    Did you have DLA before that? ... No ,working prior 2015

    Is anyone claiming Carers Allowance for looking after you? .......No.
    Last edited by upnorth62; 07-19-2019 at 11:02 PM.

  6. #6
    Senior Member nukecad's Avatar
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    OUCH indeed,

    I take that answer to mean that your savings are 'just over' £16,000?
    If that is the case then it's worse than just a deduction.

    If you have savings/capital of over £16k then no IR benefits are payable at all

    Which means that not only do you owe them all the EDP back from the date when your savings went over £16K (and part of it for when your savings were between £6k and £16k), but you can't claim the SDP either (until your savings drop below £16k again).
    The way it works with savings and capitai is:
    • Below £6k = There is no deduction from benefits.
    • £6k - £16K = Deduction from IR benefits of £1 for every £250 (or part of £250).
    • £16K plus = No IR benefit is payable at all.

    You will not be eligible to recieve ANY Income Related benefits whilst your savings are above £16,000.
    You will be able to claim some once/if your savings drop below £16,000. (But see below about Deprivation of Capital)

    The only saving grace here is that the main part of your ESA appears to be Contribution Based and so should continue to be paid.
    The normal rate would be £111.65 a week. But you won't get that much, because of course they will want to make a deduction from that to take back the overpayment.

    I've done some checking and I was wrong above. (So I've learned something more about benefits).
    If you pay back a benefit overpayment as a lump sum from your savings then they can, and will, class that as 'Deprivation of Capital with a view to claiming or increasing benefits'.
    That is because you don't have to pay it all at once, you can pay it over time.

    It's the Deprivation rules.
    You would think they would prefer it back all at once.
    But the fact is that if they acepted that then they may/would have to pay you more in benefits ongoing, so they would loose out overall and you would gain overall. (You can see that from their point of view).
    You would have deliberately reduced your savings in order to 'increase' your ongoing benefits = Deprivation of capital.

    I'm afraid that you are going to have to bite the bullet here.
    • Admit that you made a mistake by not telling them about the savings - because you thought that your ESA was all CB so you didn't have to tell them.
      (Although TBH you should have told them anyway, it's a condition of claiming 'work replacement' benefits and there are questions about it on all the application forms).
    • Accept that you are going to have to pay back the overpayment, and that your remaining ESA is going to be reduced both by the loss of the IR premium and by the overpayment recovery.
    • You'll have to live off the reduced ESA and your PIP. (And a bit from your savings?).
    • As indicated in that last point you should be able to make up the loss of benefit income by taking a bit from your savings, but tell the DWP that you will be doing that and how much you will be taking each week/month. (Once you know how much they are going to recover each week).
    • You will have to avoid any large spending of those savings now, to avoid being accused of deliberate Deprivation.


    Sorry it's not better news, but you have made a mistake, been paid too much benefit, and it's going to have to be paid back.


    I know it's a perplexing subject so here's a bit more about "Deprivation of Capital with a view to claiming or increasing benefits":

    The rules on what you can spend from your savings without it being classed as Deliberate Deprivation are a bit fuzzy.
    There is nothing set down other than that any spending has to be 'reasonable' - and the DWP decide what is and is not reasonable.
    So you are going to have to clear it with the DWP before making any major spending or purchases from your savings.

    A couple of for instances:

    Buying a new car car to replace a knackered one would be reasonable.
    Buying a Rolls or a Ferrari would not be reasonable.
    Buying a new car when you don't need one would not be reasonable. (Nor would giving your 'old' car to a family member/friend and buying another).

    Going on a mid priced holiday once or twice a year would be reasonable.
    Going on a luxury world cruise would not be reasonable.

    If you had to pay a whole bill now to avoid eviction/disconnection/etc. then that would be reasonable. (Unless you could make a payment plan instead).
    Paying off debts, loans, or credit card totals would not be reasonable - for the same reason as paying back the DWP overpayment wouldn't because you can pay over time.
    Paying off your mortgage would not be reasonable, again because it can be paid over time.

    Buying a 'paid up' pension or similar would not be reasonable - because you don't have to buy one, that would be a choice.
    Buying a 'paid up' funeral plan would not be reasonable - because it's not necessary, and if you want one you could get a pay monthly one.
    Last edited by nukecad; 07-20-2019 at 08:59 AM.
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  7. #7
    Senior Member nukecad's Avatar
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    Just to complete things about the IR Disability premiums.

    When/if your savings drop below £16,000 again (by 'reasonable' spending) then you can ask for the Income Related Disability Premiums to be added to your ESA again.

    You would ask them to send you a form ESA3 on which you would give information, including your PIP award and of course your savings.

    That would then give you both the EDP and the SDP.
    As your savings would still be above £6k then there would still be deductions, but it would still be worth it.

    EDP is currently £16.80, SDP is currently £65.85 - a total of £82.65.

    The deduction at it's most would be 9,999/250 = £40.

    Leaving you with £42.65 extra a week.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

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  8. #8
    Once again a mass of information and help received , Thank you

    Yep the wont be shining as bright for a while. However there is a horizon.

    I hope I can soften the blow by explaining it was unintentional , plus I have 2 points awarded in my pip as I need help with complex budget decisions (18 points altogether)

    I dont own a car at present , so its probably best to get shopping as this purchase will put me under or close to 6k again
    Then fill in the form for EDP and SDP.

    Interview is within a few weeks ill keep you posted as and when
    Again many thanks
    Last edited by upnorth62; 07-20-2019 at 11:51 PM.

  9. #9
    Senior Member nukecad's Avatar
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    Quote Originally Posted by upnorth62 View Post
    I dont own a car at present , so its probably best to get shopping as this purchase will put me under or close to 6k again
    Be very, very, careful about doing that, or indeed any major spending.
    In your current situation I would not even consider it.

    Unless you can show (prove) that you now suddenly need a car then it will be classed as "Deliberate Deprivation of Capital with a view to increasing benefits".
    Especially as you have now to attend an IUC, and so are now well aware that there is a problem with your savings and claiming IR benefits.

    You would need a very good explanation indeed of why you didn't need a car before, but suddenly do need one now that you are aware of the benefit/savings rules.
    It seems the only change there is that awareness and not any real need.

    TBH it wouldn't look good and even I would consider it Deliberate Deprivation in the circumstances.

    They would treat it as if you still had the savings anyway.

    At the worst they could decide it was a deliberate attempt to commit Benefit Fraud, which would put you in much deeper trouble.
    (ie. stopping ALL your benefits, and possibly even a criminal prosecution).
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

  10. #10
    Quote Originally Posted by nukecad View Post
    Be very, very, careful about doing that, or indeed any major spending.
    In your current situation I would not even consider it.
    Buying a car is the last thing on my mind this morning , but noted , Thank you

    I received lots of brown envelopes this morning
    Explaining the breakdown on my entitlement ( yes nukecad , you were spot with the figures), The letters show a £40 reduction so I will receive £88.45 a week,
    I also receive a letter stating
    "we have looked at your claim again following a recent change,we cannot pay you ESA from 17th july 2019, you are not getting anymore IR ESA allowance, we cannot pay you because you have not paid,or have been credited with enough N.I. contributions"

    just got to wait for interview now .
    Last edited by upnorth62; 07-22-2019 at 04:08 PM.

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