Benefits - Savings and Capital
There is a capital limit for Benefit of £16,000. Claimants with more than this amount are ineligible for Housing Benefit unless they are in receipt of Pension Credit Guaranteed Credit.
Capital means any savings in cash or in a bank or building society, property, land, stocks or shares.
In working out the amount of capital, a claimant is treated as possessing capital belonging to:
- the claimant himself or herself;
- any partner he or she has; and
- in certain cases, his or her children
Examples of Capital
- Capital which is (wholly or partly) taken into account for benefit purposes
- Savings in a bank, building society etc.
- National Savings Certificates, stocks and shares
- Property (unless in disregarded category)
- Redundancy pay
- Tax refunds
- Savings in cash
- Premium Bonds.
- Stocks and shares, bonds and other investments.
- Property or land (but not your home or the home of your partner or an aged or incapacitated relative).
The following do not count as capital:-
- The claimant’s home
- A self-employed claimant’s business assets
- Arrears of certain state benefits
- Certain compensation payments
- A life insurance policy which has not been cashed in
- Personal possessions.
- Sale proceeds of your home (for up to six months if you intend to purchase another home).
- Money from insurance claims in respect of loss or damage to home or personal possessions (for up to six months if used to replace or repair).
- Any Social Fund payment.
This list is not exhaustive.
If the claimant is under 60
If the claimant has less than £6,000 capital, this is ignored. If the claimant has more than £6,000 then a "tariff income" amount is used to calculate benefit. This means that for every £250 (or part of) over £6,000, £1 is counted as income. e.g. a claimant has £6,999.99 = £4 tariff income.
If the claimant is over 60
If the claimant has less than £6,000 capital, this is ignored. If the claimant has more than £6,000 then a "tariff income" amount is used to calculate benefit. This means that for every £500 (or part of) over £6,000, £1 is counted as income. e.g. a claimant has £6,999.99 = £2 tariff income.