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Question re drawdown effecting means-tested benefits
Aaron Lowe
Posted: 12 March 2018 19:51:06(UTC)
#1

Joined: 12/03/2018(UTC)
Posts: 1

My wife, who is in full time employment, is approaching 55 years so has the option to withdraw 25% of her private pension. She also receives some benefits as she is partially sighted and partially deaf.

We have a building project we need funds for so the limit of £6000 before effecting means-tested benefits is too little. Also what the money is spent on effects possible tax due. If the money is spent on something considered capitol then it can be counted as "notional income" and added to real income, with the potential of pushing my wife from the intermediate tax bracket to the high tax bracket (effectively doubling her income tax). Problem.

I can prove with bank records that I entered into an informal loan agreement with my wife before we married. I can prove she still owes me £5000 from that agreement. So, if she spent her money to pay off that loan, it couldn't be classed as her capitol as she would not have anything physical or financial to show for it.

So my question is:
Does anyone know if the £6000 limit before effecting means-tested benefits is a hard limit or based on capitol perceived to be gained by the person drawing down?

I ask this because if it is a hard limit then my wife's situation won't change anything. But if the £6000 is all capitol then maybe there is some room to increase this to cover paying off loans.

Ain't life complicated :o)
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