Beginners Guide to Benefits

When you first apply for benefits it is usually because the income you have is low and it is difficult for you to survive without a little extra help. It happens to most people at some time or another and is often due to circumstances beyond their control. Loss of job, changes in circumstances, such as having a baby or gaining or losing a partner can all result in changes of income resulting in a need for benefits. Long term sickness or disability can also mean that you need assistance, even if the sickness or disability is not your own. Caring for a family member or friend who is ill or disabled could mean that you no longer have the hours free to work a full time job and so would appreciate a top up to your income.

Changes in your circumstances

Even when you are already getting benefits, changes of circumstances can result in changes to your entitlement and so you must be sure to report them straight away. You usually have a month to report the change but if you do it straight away your new entitlement can be worked out that much faster. Obviously this is important if the change means that you will be entitled to more money, for example if you no longer work anymore or you are awarded a benefit such as Disability Living Allowance which changes your applicable allowances on other benefits. The sooner you report this kind of change the sooner you will get your increased benefit.

If the change that occurs means you are entitled to less benefit the sooner you report this change the better as well. Even if you prolong the time before you report the change, the benefit agency will still count the change from the day it happens. It could then take them several weeks to add the change the circumstances to your benefit allowance. This will mean that for all of those weeks you will still be getting the higher rate of benefit. When the amount that you are entitled to reduces the benefit agency will take steps to recover the money you now owe them for all the weeks from the actual change to the change in benefit. This could either be by asking you to repay all the money in one lump sum or a series of prearranged payment amounts. It is more likely, however that they will reduce your new, lower benefit even further to recover the funds, so for several weeks you will be getting considerably less in your benefit amount than you are entitled to and that can be very hard to live with.

The types of changes you need to report

You may not even realise that your change of circumstances will affect your benefit but you should either report it anyway, or else contact your benefit agency to see if the change is relevant. You need to let your benefit agency know if you are moving house even if this in no way will affect your benefit. If your benefit agency needs to get in touch with you they will need not only your current address but also telephone numbers and other contact information. It also could be that the benefit will now be provided from a different agency from another council or suchlike and your entire claim will need to be moved.

If you get married or move in with your partner, or even if you have a friend or lodger move in, you need to report that change as well. The new household member could have a financial situation that directly affects your own. If they are moving in as your partner the benefit agency will consider your claim as a joint one and you will need to submit a new claim as a couple. If you are a single person and you take in a lodger/paying friend then this also affects not only your income but your status for some benefits. For example in terms of council tax benefit, if you live as the only person over 18 in the household and another adult moves in you lose your single occupancy discount. As this is 25% of the amount you would have to pay, it will change your benefit entitlement considerably.

You also need to let the benefit agency know if you either start to get, or stop getting other benefits such as Carers Allowance and Disability Living Allowance of Attendance Allowance. If you intend to travel abroad for longer than the standard holiday you need to let the agency know as they will not pay benefits for the time you are effectively living in another country. They may be able to advise you as to how to get benefits or other financial help for the country you will be living in, however.

The most obvious change of circumstances that you need to report is if you get a new job; get a pay rise or significant amounts of overtime or bonuses. Even if you unexpectedly come into another sum of money, if you inherit from someone, or if you win something like the National Lottery, you should report this change of circumstances. If the amount of hours that you are working changes, you should report that as some benefits such as the Working Tax Credits award more money if you work more hours.

Will these changes of circumstances affect your benefit?

The answer to this question is sometimes they will affect the benefit you are entitled to. Some changes of circumstances will make you entitled to more benefits, others to less. Your benefit agency will be able to give you some idea of how your change in circumstances will affect your benefits when you get in touch with them. Most of the changes of circumstances will require proof, for example a copy of your new contract if you have a new job, showing the hours and rate of pay. If you have become a couple and are changing your claim you will need to bring proof of your partners financial situation, such as bank statements, proof of work, proof of benefits etc.

Changes such as becoming eligible for benefits like Disability Living Allowance or losing eligibility will need proof as well. If you want an idea of how the change will affect you, but cannot get into the office, you can call them with the change of circumstances and then send the proof through the post. They should be able to give you a rough idea of how your benefit will change while you are on the phone. If the information is not clear, they may write to you, requesting an interview with an appointment. You are allowed to reschedule the appointment if you cannot attend on that day and sometimes the issue can be resolved in a telephone call.

Failure to report a change in benefit can be seen as benefit fraud

If you do not report your change of circumstances in the allotted time, but someone else reports the change you can be considered to be deliberately committing benefit fraud. This will depend on your circumstances, obviously if you are in hospital in a complete state and do not report the change straight away you will be allowed a bit of leeway! It is a good idea to have a family or friend who could report the change for you in this case, especially if you are going to be in incapacitated for a while and most hospitals have services that can assist with this.

If you win the Lottery or get a new job, or even do work cash in hand that is above your allowable limits and you do not report it, however you can get into a lot of trouble. There is always someone who will report people in this situation, but regardless of this many of the benefits agencies work hand in hand. So if you suddenly start paying tax the Inland Revenue will flag that up to the other agencies.

If you are suspected of fraud and cannot prove conclusively that you are innocent you can face very severe penalties. Not only could you lose your entitlement to the benefit and have to pay back anything you owe, you could also face a steep fine or even a prison sentence.

Changes to your benefits

Your benefits may change in amounts even if your circumstances remain the same. Benefits are kept in line with inflation and so every April your benefits will increase a small amount. Some benefits such as Disability Living Allowance give you entitlement to an extra Christmas Bonus of ten pound; others give you help with heating bills if the temperature is below a certain threshold for a given length of time. New governments bring about new changes during their time in office and sometimes your benefit will decrease or increase in line with policy changes.

If any of your circumstances change, regardless of whether you think they could affect your benefits or not be sure to report them to the relevant Benefit Office. For local benefits you can go into the office and report them face to face. For national benefits you can telephone their care line where an operator will take down the particulars of the change and inform you if any further action needs to be taken. If you are not sure how to report a change in circumstances your local Jobseekers Plus office will be able to either help you or point you in the right direction.