pension lump sum

if i take tax free lump sum from my personel pension would it effect my esa contribution based s upport group payments and must you disclose it als can i set aside money while claiming esa contribution based income and then am later placed in imeans tested income related esa benefit for adapting my existing home for special needs for my disabilities such as bathroom wetroom downstairs thanks tommy

Tommy Miner wrote: if i take tax free lump sum from my personel pension would it effect my esa contribution based s upport group payments and must you disclose it als can i set aside money while claiming esa contribution based income and then am later placed in imeans tested income related esa benefit for adapting my existing home for special needs for my disabilities such as bathroom wetroom downstairs thanks tommy

Hi TM,

Any lump sum that you receive will not have an adverse effect of your entitlement and payment of CB ESA

There is no limit for the amount of capital assets and savings that you can have with CB ESA, it is non means tested.

However, if at some time in the future you had to be financially assessed for entitlement to payment of Income Related(IR) ESA, there are limits to the amount of capital, assets and savings that you can have :

Asset rule for ESA(IR)

With IR ESA, there is also a limit on any hours that a partner can work, if you have one :

24 hour work rule for ESA(IR)

Any household income such as Weekly/Monthly payments of a Works Pension that you may receive would be offset against any IR ESA entitlement, £ for £.

With CB ESA the rule regarding Works Pesnsions is that there is an £85/Week disregard, any amount in excess of the £85/Week is deducted from your weekly CB ESA entitlement at a rate of 50%.

e.g. Works Pension = £105/Week = £20/Week excess. 50% of £20 = £10.

Therefore, in this example £10/Week would be deducted from your Weekly CB ESA entitlement.

If the lump payment will take you over the limits for any entitlement to IR ESA in the future, you cannot simply spend it in order to gain future entitlement to IR ESA.

This may be classed as deliberate deprivation of capital in order to gain entitlement to IR benefits.

You can of course spend the money, as you have suggested, but I would strongly advise that you keep all receipts for any such expenditure, as well as anything else that you may spend your money on.

You could then provide these receipts for The DWP DM's attention, if there was the need in the future.

Only the DM can decide whether your expenditure was "Reasonable" although there should be no problems with aids,adaptations and any general repairs that may be needed.

Even though you may be entitled to and paid CB ESA, you would still have to inform the DWP of your financial details where requested.

bro58