The amount of savings your household has will affect the money you receive from means tested benefits. This means a lump sum of money, for example from an inheritance, can affect the amount of means tested benefits that you are entitled to.
Some of the means tested benefits that are affected by both income and savings include:
- Universal Credit
- Pension Credit
- Tax Credits (Child Tax Credit and Working Tax Credit)
- Council Tax Support
- Income-based Jobseeker’s Allowance
- Income-related Employment and Support Allowance
- Income Support
- Housing Benefit
Savings are classed as:
- Money in any bank or building society account
- National Savings and Investments accounts such as Premium Bonds or Income Bonds
- Stocks, bonds and shares.
- Property that is not your main home
- Valuable items
If you’re claiming Universal Credit, you can have savings of up to £6,000 before your means tested benefits are affected. However, if your savings are over £16,000 you would not be able to claim means tested benefit. There are some exemptions and disregards that may apply to the savings and so it is always best to seek expert advice. Remember, savings are considered for both you and your partner jointly.
If you claim pension credit the rules are different and your household savings can be up to £10,000 before your Pension Credit is affected. You can use the Pension Credit Calculator to check if you can claim.
What you can do
If you are making a Will and considering leaving an inheritance to someone who is in receipt of benefits, it would be a good idea to seek legal advice on how you can make provision for your loved ones without affecting their entitlements.
If you have received an inheritance, or any sort of lump sum of money and you would like legal advice on any benefits related issues, our Benefits and Credits expert can help.
To discuss your specific situation with our Benefits & Credits team you can call our enquiry team and make an appointment. We offer fixed fees on our advice and flexible appointments to suit your needs. If you can’t make it into the office don’t worry we offer telephone appointments.
You can email Howells to make an appointment at email@example.com, visit our website or call us:
Sheffield: 0114 249 66 66
Barnsley: 0122 680 51 90
Rotherham: 0170 936 40 00