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We all want to claim the government’s benefits available to the public. But, our savings can significantly impact the types of benefits we can claim. Only the population belonging to weaker social status can gain the maximum benefits from the government.
The cut-off set for the savings for the general population is £6,000. However, for those who live in a care home, it has a comparatively greater value of £10,000. Above these values, certain charges are deducted, and the individual is deprived of claiming all the available benefits.
List of benefits provided by the government
- Income support
- Jobseeker’s Allowance based on the income
- Employment and Support Allowance that is Income-related
- Housing Benefit
- Universal Credit
- Pension credit
- Council Tax Support
Based on the total capital one possesses, the benefits are claimed. Under the word ‘capital,’ all the assets held by anyone are counted. While talking about partners, both in marriage or business, the assets of both people are analyzed. For a child dependent on parents, the capital, if even present, is considered null.
What assets are counted as capital?
- Liquid cash
- Amount of money in the bank (both current and savings)
- Amount of money in a Tax-free Childcare account
- All income bonds
- If you buy shares or stocks
- Other owned property apart from the residence
- Premium bonds
While trying to be eligible for claiming some extra benefits, individuals deliberately deprive themselves of their capital. It is done by finishing off the not-so-necessary debts, transferring a particular amount to someone else, say, a friend or family member, or by using the money in the purchase of the property. This specific condition is given the name ‘notional capital’.
But doing this simply is of no use because the government bodies still assume that the capital is yours. Therefore, the persons doing so do not become eligible to claim the extra benefits. Furthermore, the government may cancel those benefits you are currently getting on being caught for this offence.
Hiding the Savings
It is challenging to hide the savings from the government as the people’s bank accounts are checked regularly. Still, it can be done with the help of a trusted aid who does not seek any of the benefits. It would require the trust and honesty of both parties.
You can open a separate bank account in their name and credentials and directly deposit the money there. However, an online transfer would not be a good option; therefore, instead of online banking, use cash. There would be no record of cash deposits directly to the account.
The same applies to cash as well. You may take out the cash and ask your trusted aid to keep them. Then, whenever you need some, you may take that from them.
Another method is to invest in cryptocurrency. It could be risky, but cryptocurrency is not treated as capital. Therefore, it may prove to be a good idea. Make sure that you research it well or consult an experienced person who is good at investing in the crypto market.
The cash could be invested in buying jewellery and antique items as well. Though these are termed as ‘dead investments,’ during an emergency, jewellery is sold at the current market price. Only making charges would be deducted. You can sell Antiques in the pawnshops, and a specific value of money is given to you.
The purchase of commercial property is a good decision. However, if you don’t need them, you can just sell them off. Also, if any repair work is required, you can get it done with the money coming from the insurance claims.
Cons of Hiding Your Savings
Hiding the savings is a punishable crime throughout the UK. Therefore, the bank accounts and the social media of the British residents are closely monitored by Department for Work and Pensions (DWP).
The majority of cases are where the people claim unemployment-related benefits despite having the means to earn.
Evidence That Shows a Case of Fraud
- Photos and videos on social media.
- Recordings of audio.
- All the financial information. It includes bank statements as well.
- Conducting your interview or that of the persons you know.
- Any kind of proof given by the persons who have launched the complaint against you.
If the Fraud Case Is True
- There would be a reduction in benefits, or they may get stopped for a maximum time of three years.
- The person may have to pay the overpaid amount back to the government.
- A penalty ranging from £350 to £5,000 may have to be paid by the person who committed the fraud.
- The criminal offence charges may be on the person, and the matter goes under legal jurisdiction.
Sentencing of the Person Who Has Committed the Fraud
- In case of serious fraud, there could be imprisonment for a maximum of 10 years.
- In case of minor fraud, only penalty charges are meant to be paid.
Factors Contributing to the Reduction of Severity of the Sentence
The sentence could be reduced if the person:
- A person should not have past or related convictions.
- He/she has a good character.
- A person has a severe medical condition.
- It is a legal entitlement to claim the benefits, but they are not claimed before.
- The person has a psychological disorder.
- He/she has the sole responsibility of relatives entirely dependent on him or her.
Hence, showing incorrect data about your financial status to the government can be a big problem for you. So, it is advisable not to do anything that brings you issues. It is difficult to escape the investigations clean and clear if your data is not right.
Still, if you plan to hide your savings from government bodies, do it cautiously to avoid getting caught. Whoever you involve in this matter should be worthy of your trust so that you can escape the investigation and further problems it may create.
Frequently Asked Questions?
Q.1. How does the DWP know about savings?
A.1. DWP gathers strong evidence via surveillance, document tracing, bank statements and many more.
Q.2. Should I claim benefits even if I am having savings?
A.2. Well, you can claim benefits if you have savings; however, it totally depends on the amount you have saved.