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ESA/PIP with Pension allowance
- Nomadic
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7 years 2 months ago #209140 by Nomadic
ESA/PIP with Pension allowance was created by Nomadic
Morning all,
My Mum who is on ESA (Income) and PIP has been notified of a pension amount from a previous employer. The amount is above the £16,000 threshold I have seen. She currently has a home through a local HA, rented. She suffers from long term mental health problems that means she will be unable to work.
I am unsure if she is on new style ESA (she is paid every 2 weeks, not monthly), as I believe lump sums do not affect these payments. I believe there are two options:
1: Draw down the amount that does not affect her benefits and buy an annuity.
2: Find out if she can draw down the full amount (which is her preference).
Any guidance welcome.
My Mum who is on ESA (Income) and PIP has been notified of a pension amount from a previous employer. The amount is above the £16,000 threshold I have seen. She currently has a home through a local HA, rented. She suffers from long term mental health problems that means she will be unable to work.
I am unsure if she is on new style ESA (she is paid every 2 weeks, not monthly), as I believe lump sums do not affect these payments. I believe there are two options:
1: Draw down the amount that does not affect her benefits and buy an annuity.
2: Find out if she can draw down the full amount (which is her preference).
Any guidance welcome.
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- Gordon
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7 years 1 month ago #209190 by Gordon
Nothing on this board constitutes legal advice - always consult a professional about specific problems
Replied by Gordon on topic ESA/PIP with Pension allowance
Nomadic
Forgive me but I am confused by your post, at the beginning you seem to be saying that your mother receives Income Related ESA but later suggest that it is Contribution Based?
If it is ESA(IR) and the money that she receives takes her over the £16,000 limit for assets and savings, then her ESA(IR) sill cease payment.
If it is ESA(CB) then any one off payment will not effect her ESA, however, if she receives a regular payment then her ESA may be reduced, see
Asset and savings rule for ESA(IR)
As to what she should do, subject to the above, that's a financial Decision that only she can make.
Gordon
Forgive me but I am confused by your post, at the beginning you seem to be saying that your mother receives Income Related ESA but later suggest that it is Contribution Based?
If it is ESA(IR) and the money that she receives takes her over the £16,000 limit for assets and savings, then her ESA(IR) sill cease payment.
If it is ESA(CB) then any one off payment will not effect her ESA, however, if she receives a regular payment then her ESA may be reduced, see
Asset and savings rule for ESA(IR)
As to what she should do, subject to the above, that's a financial Decision that only she can make.
Gordon
Nothing on this board constitutes legal advice - always consult a professional about specific problems
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- Nomadic
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7 years 1 month ago #209260 by Nomadic
Replied by Nomadic on topic ESA/PIP with Pension allowance
Thank you Gordon.
She confirmed today she is on IR. In regards to Annuity, can she split the monies into Annuity and use the rest?
And if she lost her payments, presumably dropping under £16,000 would allow her to re-apply? That is my longer term concern.
Thank you
She confirmed today she is on IR. In regards to Annuity, can she split the monies into Annuity and use the rest?
And if she lost her payments, presumably dropping under £16,000 would allow her to re-apply? That is my longer term concern.
Thank you
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- Gordon
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7 years 1 month ago #209261 by Gordon
I can't offer any advice on what she should do with the pension, it's a financial decision and outside the remit of the forum, she need to get trained advice from a financial advisor before she does anything.
As to the ESA, exceeding the £16,000 limit prevents payment of ESA it does not close the claim so if assets and savings reduce to less than this through reasonable expenditure then she can contact the DWP to have her payments reinstated.
Gordon
Nothing on this board constitutes legal advice - always consult a professional about specific problems
Replied by Gordon on topic ESA/PIP with Pension allowance
Nomadic wrote: Thank you Gordon.
She confirmed today she is on IR. In regards to Annuity, can she split the monies into Annuity and use the rest?
And if she lost her payments, presumably dropping under £16,000 would allow her to re-apply? That is my longer term concern.
Thank you
I can't offer any advice on what she should do with the pension, it's a financial decision and outside the remit of the forum, she need to get trained advice from a financial advisor before she does anything.
As to the ESA, exceeding the £16,000 limit prevents payment of ESA it does not close the claim so if assets and savings reduce to less than this through reasonable expenditure then she can contact the DWP to have her payments reinstated.
Gordon
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- Nomadic
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7 years 1 month ago #209264 by Nomadic
Replied by Nomadic on topic ESA/PIP with Pension allowance
Reasonable expenditure, reasonably vague as per most legislation...
What happens if the expenditure is deemed to be unreasonable?
Thank you again.
What happens if the expenditure is deemed to be unreasonable?
Thank you again.
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- Gordon
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7 years 1 month ago #209281 by Gordon
Nothing on this board constitutes legal advice - always consult a professional about specific problems
Replied by Gordon on topic ESA/PIP with Pension allowance
Nomadic
Unfortunately there is no clear definition of what reasonable expenditure means, ultimately it is at the discretion of a Decision Maker if there are issues as to how she has reduced her savings. I can tell you that the early payment of a load or mortgage is usually considered to be unreasonable but buying a new TV usually isn't.
If the expenditure is considered to be unreasonable then she will be treated as still being in possession of the money which could have an impact on her receiving ESA payments again.
My best advice is to be sensible with how the money is spent and to keep receipts for everything.
Gordon
Unfortunately there is no clear definition of what reasonable expenditure means, ultimately it is at the discretion of a Decision Maker if there are issues as to how she has reduced her savings. I can tell you that the early payment of a load or mortgage is usually considered to be unreasonable but buying a new TV usually isn't.
If the expenditure is considered to be unreasonable then she will be treated as still being in possession of the money which could have an impact on her receiving ESA payments again.
My best advice is to be sensible with how the money is spent and to keep receipts for everything.
Gordon
Nothing on this board constitutes legal advice - always consult a professional about specific problems
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