Compensation and benefits

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In 2014 I had I serious accident resulting very serious injuries I have been on benefits since then including pip,Esa my partner also claims Careras allowance i live in private housing rent paid by housing the end of this year I will be getting compensation in the region of £100000 although would love to have my own house and not being claming benefits that doent seem possible I will not be going back to work in the near future so what happens with benefits do I have to stop claiming and just let the compensation run out then reclaim?

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4 Replies

  • Posted

    I'm not positively sure, but I would imagine you would have to stop claiming benefits as your payment is over the £6,000 they allow.

    You should receive a letter from DWP about what will happen as they are informed about compensation awarded.

    I also believe that they request the benefits you have been paid since your accident be refunded, but I would imagine the person/organisation you receive the compo from would pay this?? It may be worth asking your solicitor as you don't want a surprise bill from DWP the same day you receive your money.

    Hope that helps.

    P.s, DWP will want to know what you have spent money on if you make another claim soon after you receive it as some people try to intentionally hide the money by saying large sums are for various non essential

  • Posted

    If you're claiming Contribution Based ESA then it wouldn't affect it. If it's Income Related ESA then the money you recieve would be disregarded for a total of 52 weeks. This doesn't mean you can just go on a huge spending spree because they'll want to know everything you spend it on. I don't think it's disregarded for HB or Council tax. When you recieve the payment DWP etc will be informed by who ever pays you the compensation but you'll still need to ring DWP and HB to tell them. Hope this helps.

  • Posted

    Hi Paul, some years ago I inherited a lump sum, so had to make the same decisions, yes, you must stop claiming and means tested benefits as soon as you receive the money, including HB and council tax benefit. Once your capital is below the limit you can claim again, but they will want to know how you spent the money, and will challenge you if they think it has been spent inappropriately, that is not for either living costs, or things which are reasonable in light of your disability, for example equipment or adaptations. 

    I was lucky, in that for me I was able to use the capital as a springboard back into work. After a lot of research I I was able to invest the money to give a small , but secure income, my rent and living cost are low, so this then meant I have a smaller gap to fill, and so far I have just about been able to cope with the paid work needed to fill this gap. It has been, and still is a struggle, and I have had several episodes of illness, but I am surviving. I do receive PIP which then entitles me to some working tax credit, means tested on income but not capital- I didn't know this until recently- but otherwise I am not dependent on state help, or subject to state interference and control. The way I see things, it is going to get harder and harder to get state support, however badly disabled you are, so the more independent I can be, the better.

    obviously I don't know what your situation is, or if this is possible for you, but I would advise you to do some research, maybe get advice from CAB or a disability advice service, to see what the possibilities are.

  • Posted

    Hi Paul,

    this is very complicated. I have done some research for you and it seems that this compensation may not be disregarded for 52 weeks. I'm fairly certain all means tested benefits will stop.

    Erykah is right, it depends on the reasons why you're claiming ESA and PIP. If the reasons you're claiming those benefits is because of the accident then what you've claimed will have to be paid back, but i think those that are paying the compensation are responsible for paying back the ESA at least. You're PIP will also need to be paid back if the reasons you're claiming it are because of the accident, this is because you can't be compensated twice for the same thing. Who is responsible (you or the compensator) in paying this back i don't know. It's extremely complicated and i would advice speaking to a solicitor or CAB who would be able to give you the best possible advice.

    The compensator will notify all departments of your compensation.


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