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Receipt of lump sum pension effect o new style esa

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3 years 7 months ago #261404 by Elidor
My partner has been receiving new style contributary based ESA for about 2 years. Just before the end of 2021 tax year he cashed in a small pension and got a lump sum of around £5467 paid into his bank account on 6th April 2021. He didnt think about telling the DWP about this at the time but I am worried that it would count as a change of circumstances and his benefit could be stopped if we tell them now. I think you are allowed one off lump sums and they dont affect this type of ESA but concerned about informing them now as 2 months later. Advice about best way to proceed would be welcome.

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3 years 7 months ago #261473 by BIS
Hi Eleanor

I'm sorry, but your question is outside the scope of this forum. You need to ask a specialist benefits adviser.

If you don't have anyone, you may be able to find one here. advicelocal.uk/

BIS

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3 years 7 months ago #261496 by Gary
Hi Eleanor

The first lump sum that you take should be treated as capital and therefore should have no effect on your ESA(CB), any regular payments and possibly and any second lump sum will be treated as pension income and may reduce your ESA(CB) depending on the amount.

There is an £85/week disregard followed by a £1/week deduction for every £2 in excess of the £85.

Gary

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3 years 7 months ago #261603 by Elidor
Many thanks for your reply Gary. Do you think we need to tell the DWP about the lump sum even though it will be ignored. Im thinking yes to avoid any potential problems but assume HMRC will tell them as they have deducted tax which he is owed. I'm a bit worried about his ESAbeing stopped if they find out we havent told them even though the lump sum is allowed.

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3 years 7 months ago #261607 by Gary
Hi Eleanor

To put your mind at ease I would contact DWP and run it past them, explain to them you are in receipt of NS ESA and cashed in a small pension to make ends meet and that you are checking to see if you are required to report it to DWP as you have received conflicting stories.

Let us know how you get on.

Gary

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3 years 7 months ago #261628 by Elidor
Thanks Gary, I'll do that. It seems impossible to get through on the phone so will write to them.

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