Private pension and benefits

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Hi all,

I have a private pension which I would like to cash in as I am having a driveway built because my mobility is restricted and when I go out I can't always get parked outside my house. I could phone DWP to ask my question but it's always difficult to get through to them and a bit hit and miss as to whether you will even be given the correct information! The money would briefly take me over the £6,000 threshold but I wouldn't have it for long (maybe a week) as it would all be used to pay for the driveway, so I wonder whether they would disregard it for this reason and not deduct any money off my benefits?

My other question if anyone can help is with the taxation of the pension.  I understand that the first 25% is ignored and the rest is taxed at 20%. Are people on benefits exempt from taxation? It is quite a chunk of tax to pay if not! I receive PIP standard living and enhanced mobility and also ESA and I am in the support group.

Thank guys!

Mary

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10 Replies

  • Posted

    Hi,

    It depends whether you're claiming Income related or Contribution based ESA. Contribution based isn't means tested and savings/capital don't affect it. Income related, anything over £6,000 will affect your ESA £1 for every £250 over that amount. It doesn't matter if the money isn't going to be in your bank for very long, if you're claiming Income related then you need to report the changes as soon as the money goes into your bank. It won't be disregarded for this purpose.

    Also if you claim housing benefit and council tax reduction then the same rules apply to these as they do for Income Related ESA because they're a means tested benefit. Any changes need to be reported. 

    If you're unsure which one you're claiming the a recent ESA award letter will tell you or you can ring ESA and ask. Some people receive all contribution based, some receive al income related and some receive contribution based with an Income related top up. 

    I'm sorry but I can't help with your tax question. PIP isn't means tested and won't be affected. 

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    • Posted

      Thanks Denise, I always marvel at your knowledge of so many benefit related queries! I'm on part contribution and part income apparently. I don't fully understand how it's all worked out! I don't get housing benefit as I have a mortgage but I get council tax reduction - forgot about that, it would affect that I know. Thanks for your help 😊. Regards, Mary 

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    • Posted

      You're welcome Mary. I've just learnt the system over the years from plenty of research, it's complicated for sure. 

      OK Contribution based is £110.75 per week, anything over this will be affected £1 for every £250 over £6,000. For others reading this, over £16,000 and means tested benefits stop. 

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    • Posted

      Hi again Denise, I wonder if you could advise me on PIP reassessments. I was awarded PIP in September 2016 for three years to 2019, so does this mean next September I will receive my reassessment form and then be reassessed the following year? I'm asking as I'm considering getting a mobility car this year as my car is not in great shape; the heating tends not to work in the winter and rain gets in through the back doors, soaking the floor, causing condensation and a bad smell! I'm just concerned about getting a car in case I'm not successful in being re-awarded PIP when I'm reassessed and then the mobility car would be taken away and I'd have no car. Do you know how long it takes to have a face to face after the form is received? Thanks, Mary 

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    • Posted

      Hi,

      Reviews are done 1 year before the award is due to end, so you'll be sent the form this September (next month) for re-assessment this year and not next year. Once you receive the form you'll need to fill it in, return it by the date stated on the letter, along with all your evidence and then they'll send you for another assessment. Waiting times for assessments vary depending on backlog in your area. Some wait weeks, while others wait several months. If the decision goes in your favour you'll be given another award date but if it doesn't go in your favour then your PIP will stop 4 weeks after the decision is made, regardless of your PIP award being until September 2019. 

      For the mobility car you need Enhanced mobility, if this is what you have then i'd advise waiting until the decision's been made on this review because that's very soon. Yes, you only need 12 months remaining on an award for the car but as your review is soon then it's probably best if you wait. 

      Sorry if this isn't what you were expecting. Good luck with the review and don't be fooled by the shortened form, put as much information down as possible. Remember also that they rarely contact anyone for evidence. Most people have face 2 face assessments, even for review. 

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    • Posted

      Oh goodness, thank you so much for this info Denise. I hadn't realised I'd be getting the form this year! I will definitely hold off on the mobility car for now and hope my old jalopy keeps going! Meanwhile I'll 'look forward' to my re-assessment -.not! Yes I get enhanced mobility so qualify for a mobility car - for now anyway! What would this forum do without you! I hope your ESA re-assessment goes well - I remember reading recently that you had your form to fill in. I was successful with my ESA re-assessment last year and was placed in the support group which was a huge relief. I had a lovely lady advocate who came with me to the face to face and she was a huge help to me. Take care, Mary

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    • Posted

      You're welcome Mary. Holding off with the car is a wise choice, I would do the same. I have a mobility car and I have no idea what i'd do without it. 

      My daughters PIP review is October this year, i'm her appointee so will be faced with all that too....the joys. She was only awarded for 2 years, with review at 1 year. She has a learning disability, autism and social anxiety disorder which comes from the autism...of course she's going to get better, which is why she had such a short award rolleyesrolleyes Yes, I know it's not award based on a diagnosis, but the way the conditions affect you but her award length is ridiculous. 

      My form has been posted, fingers crossed i'll be kept in the support group but I won't take anything for granted.

      As for the forum, I've told myself so many times that i'm not going to check as often but then I feel guilty because if someone posts a question and I don't answer I feel bad. rolleyes Besides, I made some really good online friends since I've been here and for that, i'm very grateful. 

      If you need some advice during your PIP review please just ask. I'm always about somewhere. x

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    • Posted

      Thank you Denise, you're a great help to everyone but don't feel guilty if you take a break from the forum sometimes - you matter as much as anyone else. Awards are ridiculously short at times and cause much stress to folk already struggling with their health. And your daughter's award is one such case. Unbelievably short and why as you say with the needs she has! 

      I've just rechecked my award letter dated 7 Septmber 2016. It followed a successful mandatory appeal and says the PIP was awarded from 17 March 2016 to 9 June 2020, (so I presume this means the reassessment form will be sent next year and not this year? And presumably around June 2019?

      Regards,

      Mary x

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    • Posted

      Always my pleasure! I will try rolleyes

      Yes, they'll send you your review form June 2019. As you have Enhanced mobility then if I were you i'd take a look on the motability website to see what cars you can have. With an award length still 10 months till your review, it maybe worth having the car. As your car is in such a bad way then you shouldn't delay this process. Choose a few cars you think you'll like, contact the dealers and tell them you have an Enhanced mobility PIP award and would like to test drive a car. You'll need your PIP award letter when you go, as well as your driving license. Some cars you have to pay a down payment before collecting, depending on what car you choose. There's lots that have no down payment, it really depends what car you want. Some cars will be ready for collection quicker than others. I only waited 2 weeks for mine and I love it. If you can't manage a manual then choose automatic, any adaptions needed they will arrange that for you. Some you have to pay extra for, they'll tell you all this. The dealers I went to were extremely helpful! All you have to pay for is fuel but you do exchange all of your mobility allowance for this and it will be paid to motability instead of you. Motability arrange everything, insurance and tax and all you have to do is test drive, choose, order and sign and collect when it's ready. Fun test driving all those new cars and that new car smell..... the best! cheesygrin Hope this helps and if you do chose a car then please come back and let me know what you chose. Mine is a Suzuki Vitara. 

      Take care! x

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    • Posted

      Thanks Denise. I've never had a new car in the whole of my 62 years, lol! I would go for a small one,  no bigger than a fiesta, but I need to test drive some first. Mini's appeal to me. With the size of car I need, I wouldn't need a down payment which is good. I had a mini in the eighties, and it was a lot of fun, but it would depend on what these new ones are like to drive I guess.

      I'll let you know what I decide to do. It's scary giving up my own car in case they don't renew my award when it's due, and then I would be car-less, but mine could conk out any time I guess given its age and things going wrong, though it's always been a very reliable car (Renault Laguna). It's too big for me now really and though it has power steering, it's not that light because it's an old car (2000) and it's hard to park too, and cold in the winter with no heating, though at the moment it is working fine. I needed it the other day when it was so cold and wet, but as the winter goes on, it gets damp and the central locking doesn't work and neither does the heating fan. Today the wing mirror adjustment knob broke! Think I am getting the message car!

      Thanks Denise, take care, x

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