benefits

Energy Company Obligation Scheme ECOS

How Universal Credit Claimants Can Get Free Energy-Saving Home Improvements via the Government’s Energy Company Obligation Scheme

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The number of people applying for Universal Credit has surged to record levels as a result of the Coronavirus pandemic and the numbers are set to rise further with the ongoing economic uncertainty.

In addition to a loss of income, households could also be facing a rise in energy-bills due to more time spent at home and cold weather approaching. Many will be coming to grips with the benefits system for the first time and starting to understand the rules, regulations and complexities around making a claim.

However, there is a little known silver lining for these claimants. Anyone who has claimed Universal Credit successfully will also be eligible for home improvements under the Government’s Energy Company Obligation (ECO) scheme.

This current scheme, called ECO3, targets people that have high energy costs comparative to household income. The scheme has a list of ‘qualifying benefits’ for eligibility. Universal Credit is on that list.

Plus, there are no savings or income-tests for the qualifying benefit part of the application, so if you receive any benefit on the list below (excluding Child Benefit, as that has an income cap), it’s likely you’ll be eligible.

According to Ofgem (who administer the ECO scheme), claimants will still be eligible for a period of 18 months following the date of the letter for the Universal Credit award (page 44 of the Ofgem ECO3 guidance has full details).

So if, say, you were awarded your Universal Credit in April but you got a job last week and came off Universal Credit today (for example), you still have a significant period of time (a year and a half) to apply for and install the measure, as you would still be classed as eligible even when you return to work. While you can wait to apply, it’s advisable to apply sooner rather than later, as funding rules can change at any time.

Even if you have returned to work or are planning to return to work, you will still be eligible, providing you have had at least one award for Universal Credit.

And it isn’t just Universal Credit recipients who are eligible for grants. Also on the ‘qualifying benefits’ list are the following:

  •  Armed Forces Independence Payment
  •  Attendance Allowance
  •  Carer’s Allowance
  •  Child Benefit*
  •  Child Tax Credit
  •  Constant Attendance Allowance
  •  Disability Living Allowance
  •  Income Support
  •  Pension Credit (Guarantee)
  •  Employment and Support Allowance (income-related)
  •  Jobseeker’s Allowance (Income-based)
  •  Income Support
  •  Industrial Injuries Disablement Benefit
  •  Mobility Supplement
  •  Personal Independence Payment
  •  Severe Disablement Allowance
  •  Universal Credit
  •  War Pension Mobility Supplement
  •  Working tax credit

* Note: If Child Benefit is the only qualifying benefit you receive, you will also need to meet additional income rules detailed here.

You will still be eligible if you return to work as you can claim for a period of 18 months after claiming benefits.

What Grants Are Available?

There are a range of energy-efficiency measures that can be installed under the Energy Company Obligation (ECO) scheme, including boiler upgrades, home insulation and heating upgrades. The Scheme is funded by the major energy companies and if you claim benefits, you are entitled to this funding.

Table: Measures Available Under the Energy Company Obligation Scheme

MeasureHomeownersPrivate TenantsHousing Association TenantsLandlordsCouncil Tenants
Air Source Heat Pump (ASHP)✅✅✅❌ Landlords
✅ Private tenants can apply		❌
Boiler Upgrade or Repair✅❌❌❌❌
Cavity Wall Insulation✅✅✅❌ Landlords
✅ Private tenants can apply		❌
Electric Heating Upgrade✅✅✅❌ Landlords
✅ Private tenants can apply		❌
First Time Central Heating (FTCH)✅✅✅❌ Landlords
✅ Private tenants can apply		❌
Internal Wall Insulation✅✅✅❌ Landlords
✅ Private tenants can apply		❌
Underfloor Insulation✅✅✅❌ Landlords
✅ Private tenants can apply		❌

How Much Could You Get?

The amount of funding available depends on a range of factors, including property type, your existing heating, wall type and potential energy savings from proposed work.

The first step in working out what you could get is to check your eligibility online. There’s a quick form on the Energy Saving Genie website where you can enter your details to see if you are eligible.

If you meet the criteria, you can choose to apply and once your application has been submitted, it will be passed to a Registered Installer.

The Registered Installer will arrange a free survey of your property. You can choose to proceed ASAP with a survey taking place following strict health and safety guidelines or you can choose to wait until after Covid-19.

Once the survey has taken place, the surveyor will report back to the Registered Installer, who will talk you through the grants that are available towards energy-efficiency measures at your property.

The grant is paid directly to the installer and they are awarded on lifetime savings (LTS) scores. Currently electric heated properties and larger properties tend to receive the most funding. But even if your home isn’t large or heated by electricity, it is worth applying as you could still receive a significant grant towards home improvements.

So if you are one of the many million new Universal Credit claimants due to Covid-19, you can start the process of applying for a home improvement grant that will knock £££s of your energy bills for years to come, well after the pandemic has passed.

Check your eligibility here!

Disclosure; This is an adapted reblog of an original post by Energy Saving Genie. It is also a sponsored post. If you click through and end up taking advantage of this government scheme, I will receive a fee for introducing you. This will not affect any products or services you may receive or the value of any grants you may be awarded.

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How Over-75s Can Claim Pension Credit to Keep Their Free TV Licence

How Over-75s Can Claim Pension Credit to Keep Their Free TV Licence

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As you may have heard, the BBC has now confirmed that from 1st August 2020 people over 75 in the UK will lose their automatic right to a free TV licence and have to pay the same £157.50 a year as everyone else. This was originally due to happen in June 2020, but it was postponed due to the coronavirus pandemic.

For many old people, TV is their main (or only) source of company. Suddenly having to find this quite large sum out of (in many cases) a very limited income may cause them financial difficulties or downright hardship. Some may even have to choose between watching television and paying their heating bills.

This parlous situation has arisen because the BBC say they have to make economies, and continuing to subsidise free licences for the elderly would force them to cut back drastically in other areas. Meanwhile the government, despite their pre-election promises, has shown no sign of stepping in to preserve free TV licences for over 75s (which they could perfectly well do). Although charities such as Age UK have been raising petitions and applying as much pressure as they can, it now seems certain that this change is going to happen.

So what can people in this situation – or their relatives/friends/carers – do? The BBC have allowed just one concession – the poorest over-75s can continue to receive a free TV licence if they claim and receive pension credit. So let’s look at this in a bit more detail…

Pension Credit

Pension credit is a state benefit for people above retirement age who are on a low income. It can be paid to single people or to couples. It is usually paid weekly, though you can also choose to have it paid fortnightly or monthly.

Along with attendance allowance – which I discussed in this recent post – pension credit is one of the most under-claimed benefits. According to the Department for Work and Pensions, around 40 percent of eligible people, or two in five, fail to claim it. That’s an estimated 1.5 million eligible households in the UK who are missing out.

Pension credit actually comes in two parts – guarantee credit and savings credit. Guarantee credit boosts your weekly income to £167.25 if you’re single or £255.25 if you’re a couple (all figures correct as of March 2020). You may be eligible for guarantee credit if you have reached state pension age and your total income is less than these amounts (even if you own your own home). If you have under £10,000 in savings and investments this will not be taken into consideration. If you have over £10,000, it will be assumed that you earn £1 a week per £500 of savings and investments (equivalent to an interest rate of 10.4% – if only!). This will be added to your total income when working out your eligibility.

Savings credit is meant to be a reward for those who have saved for their retirement. It’s worth up to £13.73 a week for a single person or £15.35 for couples. To qualify, you must have a minimum income of £144.38 a week if you’re single, and £229.67 a week if you’re in a couple. For every £1 by which your income exceeds this amount, you get 60p of savings credit – up to the £13.73/£15.35 maximum. If your income is less than the £144.38/£229.67 savings credit threshold, you won’t qualify. Savings Credit is only available to people who reached state pension age before 6 April 2016. Couples where only one partner reached state pension age before 6 April 2016 can also retain savings credit if the older partner had reached 65 and qualified for savings credit before that date AND they have remained continuously entitled to it ever since.

It’s worth adding that if you pay mortgage interest or have other housing costs, have caring responsibilities, are responsible for a child, or are severely disabled, you may be entitled to more pension credit. If you receive attendance allowance or carers credit, for example, this may boost the amount you’re entitled to. The rules surrounding all this are complicated, but the government has provided a free online calculator you can use to work out whether you qualify and how much you might get. This is for guidance only, however. You can’t apply via the calculator and there is no guarantee that you will receive the amount it shows you.

To actually apply you will need to phone the DWP’s Pension Credit helpline on 0800 991234. You will need your National Insurance number, information about your income, savings and investments and your bank account details. The person you speak to will then take you through the application process. This is a subject I discussed in more detail in this blog post, as I recently helped an older friend to do this successfully.

What Does Pension Credit Entitle You To?

As well as the money – which can amount to thousands of pounds a year – if you receive pension credit you will be entitled to a range of additional benefits. A free TV licence if you are over 75 is just one of them. You may also get:

  • reduced council tax (or free if you are awarded guarantee credit)
  • free NHS dental treatment
  • help towards the cost of glasses
  • help with the cost of travel to hospital
  • cold weather payments
  • automatic entitlement to the Warm Home Discount
  • help with rent
  • free home insulation and boiler grants
  • extra money if you’re a carer

Even if you only receive a small amount of pension credit, you will be eligible for all of the above. So it really is well worth applying if there is any chance you may qualify. As mentioned above, you can check first using the free online calculator here and then apply by phoning the DWP’s Pension Credit helpline on 0800 991234.

Don’t delay, as there are now just seven weeks left before the free TV licence for all over-75s becomes a cherished memory.

Equity Release to Boost Your Income

If you’re still struggling to pay the bills even with pension credit, there are other methods to help boost your income. In particular, UK homeowners are fortunate to have opportunities to unlock their property value. An equity release loan could provide the security you desire if you require the means to pay for life’s simple pleasures or cover essential costs.

What’s more, homeowners can unlock up to 65% of their property value, with no compulsory payments required during their lifetime. There’s no limit on how you can use the tax-free cash you receive, so an income lifetime mortgage could be the ideal way to pay your bills and have a bit extra for luxuries as well.

As always, if you have any comments or questions about this post, please do leave them below.

This is a revised and updated version of my original March 2020 post. 

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Applying for pension credit

My Experience of Applying for Pension Credit

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In this recent blog post I discussed how over-75s may be able to avoid losing their free TV licence by claiming pension credit.

As I said then, I have recently done this myself on behalf of an elderly couple who are friends of mine. As promised, today I’ll be sharing my experience of the telephone application process. I hope anyone thinking of doing this themselves or on behalf of elderly friends or relatives may find this helpful.

But first, let’s recap on what pension credit is…

Pension Credit

Pension credit is a state benefit for people above retirement age who are on a low income. It can be paid to single people or to couples. It is usually paid weekly, though you can also choose to have it paid fortnightly or monthly.

Along with attendance allowance – which I discussed in this recent post – pension credit is one of the most under-claimed benefits. According to the Department for Work and Pensions (DWP), around 40 percent of eligible people, or two in five, fail to claim it. That’s an estimated 1.5 million eligible households in the UK who are missing out.

Pension credit actually comes in two parts – guarantee credit and savings credit. Guarantee credit boosts your weekly income to £167.25 if you’re single or £255.25 if you’re a couple (all figures correct as of March 2020). You may be eligible for guarantee credit if you have reached state pension age and your total income is less than these amounts (even if you own your own home). If you have under £10,000 in savings and investments this will not be taken into consideration. If you have over £10,000, it will be assumed that you earn £1 a week per £500 of savings and investments (equivalent to an interest rate of 10.4%). This will be added to your total income when working out your eligibility.

Savings credit is meant to be a reward for those who have saved for their retirement. It’s worth up to £13.73 a week for a single person or £15.35 for couples. To qualify, you must have a minimum income of £144.38 a week if you’re single, and £229.67 a week if you’re in a couple. For every £1 by which your income exceeds this amount, you get 60p of savings credit – up to the £13.73/£15.35 maximum. If your income is less than the £144.38/£229.67 savings credit threshold, you won’t qualify.

While for most people pension credit won’t be a huge amount, it has the big advantage that it acts as a gateway to a range of other discounts and benefits. The free TV licence for over-75s is just one of them. Pension credit recipients may also get reduced council tax (or free if awarded guarantee credit), free NHS dental treatment, help towards the cost of glasses, help with the cost of travel to hospital, cold weather payments, automatic entitlement to the Warm Home Discount, help with rent, free home insulation and boiler grants, and more. All of this means it is well worth applying for, even if you’re not certain whether you qualify.

Checking Your Entitlement

The government is keen that anyone eligible for pension credit should claim it. To that end they recently launched a free online calculator you can use to work out whether you qualify and how much you might get.

You can use the calculator anonymously to check your entitlement (or someone else’s), either as an individual or a couple. You can’t actually apply via the calculator, though. It is just for guidance, to help you decide whether it’s worth putting in a claim.

The calculator asks a variety of questions about your circumstances and current income, including any pensions or other benefits you may receive. The latter may actually improve your chances of getting pension credit. For example, if you receive attendance allowance and/or carer’s credit (as my friends do) this can improve your chances of qualifying. When I did this on behalf of my friends, the calculator showed that they should be eligible for a payment of just over £10 a week.

As mentioned above, the results on the calculator are for guidance only, and there is no guarantee that you will receive the amount shown. However, in my friends’ case it definitely confirmed that applying would be worth doing.

Applying for Pension Credit

By far the easiest way to apply for pension credit is to phone the DWP’s Pension Credit Helpline on 0800 991234. You will need to have your National Insurance number, information about your income, savings and investments and your bank account details to hand.

If you’re applying on someone else’s behalf, the DWP like you to have the person concerned with you at the time. The call handler spoke briefly to my friend to confirm her personal details and that she was happy for me to take over the application process.

It turned out to be a two-stage procedure. Initially I spoke to a male call handler who asked a list of questions about my friends’ circumstances and their finances. This was basically the same set of questions I had answered on the online calculator. It was reasonably straightforward, and at the end he informed me that my friends did indeed appear to have a valid claim, so he was going to put me through to his colleague who would take me through the actual application.

This meant that I had to answer the same set of questions again from another DWP employee – a woman this time, as it happens. This did strike me and my friend as rather a waste of everyone’s time. We wondered why the answers I had given initially couldn’t just be passed on to the second person, but I suppose the DWP must have their reasons.

Anyway, we duly went through all the questions (and a few more) again. I would, incidentally, comment that the young woman I spoke to – who told me her name was Jenny – was extremely pleasant and helpful. At one point we went off at a tangent and started talking about our favourite cakes (well, it was tea-time by then). I felt she went out of her way to help us, and she certainly made the whole application process a lot less stressful.

After going through all the questions, Jenny said she would need information about how much exactly was in my friends’ bank accounts and when their (small) private pensions were paid in. This could have been problematic, as it involved logging in to my friends’ online bank accounts and finding this information there. But Jenny was patient and flexible about this, and in the end we found all the information she needed.

The whole process took a little over an hour. if you have to break off half-way through that is possible and you can ask for a reference number so you can complete the application another time. But I really wanted to get the whole thing done and dusted in one call, and thankfully – with Jenny’s help – we achieved that.

The Outcome

After about six weeks my friends received a letter from DWP saying their application had been successful and they had been awarded pension credit.

The amount was the same as had been shown on the online calculator. It was about £10.50 a week, going up to almost £12 in April (I’m sorry I can’t remember the exact figures). This money was savings credit rather than guarantee credit, but that makes no difference as far as the free TV licence is concerned. If you are over 75 and qualify for either type of pension credit (or both) you are entitled to a free TV licence.

We then submitted the short application form to the TV licence people, with a copy of the first page of the DWP letter confirming the award of pension credit. We haven’t heard any more since, but presumably my friends will receive their free TV licence in the coming weeks.

So that was my experience of applying for pension credit on my friends’ behalf. I hope it has encouraged you to proceed with your own application if you are considering making one. If you get to speak to the lovely Jenny in Scotland, do pass on my regards to her!

And if you have any comments or questions about this post, of course, pleased free free to leave them below as usual.

This is a fully updated repost of my March 2020 article.

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So why does a money blogger need a personal financial adviser?

So Why Does a Money Blogger Need a Personal Financial Adviser?

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…that’s the question I was asked recently by a Pounds and Sense reader after I mentioned in this blog post that I had a financial adviser.

Of course I replied to her directly at the time, but on reflection I thought it would be good to provide a more in-depth answer to this question on the blog.

To recap, my financial adviser is called Mike and he works for a company called Integrity Wealth Solutions. I was recommended to Mike by my accountant, and he has been advising me for over three years now.

Mike actually looks after about half of my portfolio. He advised me about this initially and set up the recommended investments on my behalf, making maximum use of my tax-free allowances. He continues to monitor my investments and makes any recommendations for adjustments as required. I see Mike once a year in person to review how things are going (both with the investments and me personally). But of course, I can also speak to him by phone (or email) any time if required.

The other half of my portfolio I look after myself, and it is fair to say it is well diversified! As regular readers of PAS will know, I have investments in property crowdfunding, P2P lending, the robo advisory platform Nutmeg, and various others.

Why then do I need Mike? Here are just some of the reasons…

1. Mike is a trained and experienced independent financial adviser/planner who works full-time in this field. I am a money blogger and obviously have a special interest in financial matters, but I have no professional training or direct work experience in this field. I can ask Mike for his professional opinion on any investment-related matters, and while I am not obliged to follow his advice I do of course take it very seriously.

2. Mike has a backup team in his office and access to specialist investment research services and software. He uses these resources to inform his advice, and also to provide in-depth reports (with snazzy-looking charts and spreadsheets!) regarding how my investments are performing.

3. As a regulated financial adviser, Mike has to follow all the correct protocols and ensure that all advice he gives follows best professional practice and is appropriate for my needs and circumstances. He cannot cut corners, invest on a whim or hunch, or let himself be distracted by the latest ‘bright shiny object’ in the investment world. I have to admit that I have been guilty of all of these things myself in the past!

4. As a professional financial adviser Mike also has access to certain investment opportunities or platforms that are not easily accessible to the general public. I won’t go into detail about this here, but it is certainly something I have had occasion to be grateful for in the current coronavirus outbreak.

5. Mike is able to provide personalized but objective advice about my finances, based on information I give him. Money and investment can be emotive subjects, and it’s great to have a sympathetic – but at the same time sensible and detached – professional advising you. I am sure Mike sometimes sighs inwardly at some of my more exotic investments, but he is always interested in what I have been doing with ‘my’ half of my portfolio and happy to offer his thoughts as appropriate.

Are there any drawbacks to having an adviser? Well, of course, you have to pay them! In the case of Mike I paid an up-front fee initially and now pay a small monthly commission. Hand on heart I can say that Mike is well worth his fee, and even in the current exceptional circumstances his charges have been more than covered by the amount by which my investments have grown.

So that is why I have a personal financial adviser. If you are fortunate enough to have money to invest, I strongly recommend you consider engaging one too.

If you would like to find out more about the service offered by Mike and his colleagues at Integrity Wealth Solutions, you can check out their website and contact them on 02476 388 911, or email them at advice@integritywealth.co.uk. They are friendly and not at all pushy, and will be delighted to talk you through the service they offer without obligation. If you do get in touch, please mention that you were recommended by Nick Daws of Pounds and Sense blog. If you end up becoming a client they have said that they will pay me a small fee to say thanks. This will help to cover my costs and ensure I am able to go on sharing tips and advice to Pounds and Sense readers.

As always, if you have any comments or questions about this post, just let me know.

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When Can You Get a Free Bus Pass

When Can You Get a Free Bus Pass?

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For many older people the free bus pass (officially known as the older person’s bus pass) is a valuable concession. It helps them get about and maintain their independence without eating into their often limited income.

Holders typically get free bus travel within their local authority area between 9.30 am and 11 pm on weekdays and all day at weekends.

The rules for when you qualify for a free bus pass vary according to where in the UK you live. In Scotland, Wales and Northern Ireland, it’s straightforward. You qualify once you reach your 60th birthday.

Those living in England are not as fortunate. In this case, you won’t qualify until you reach the current state pension age. This is currently 66 for both men and women. The state pension age will start to increase again from 6 May 2026, and will reach 67 by 6 March 2028.

Once you have reached the qualifying age in whichever country of the UK you live, you can apply via the government’s Apply for an Older Person’s Bus Pass page. You will see a box on this page in which to enter your postcode. Clicking through this should take you to the website for your local authority (though you may have to navigate to the page for travel concessions from there). You can then apply online for your bus pass. Requirements can vary from one local authority to another, but in general you will be required to upload a passport-style photo, proof of identity, and proof of residency in the area concerned (e.g. a council tax bill). For info about how to renew your bus pass online, please click here.

  • If you don’t want to apply online, most authorities also offer an option to apply in person, e.g. at a public library. Your local authority website should have more information about this.

Some local authorities have their own schemes and concessions for older (and/or disabled) people. Again, your local authority website should tell you if there are any special concessions for older people in your area, or you can ask at your local library.

In London, once you reach the female state pension age you can apply for an Older Person’s Freedom Pass. This entitles you to 24-hour free travel across Transport for London’s networks (except for some river boats where travel is half price). You can check your eligibility for a Freedom Pass and apply here.

Cards and Discounts

Even if you don’t yet qualify for a free bus pass, there may be other ways you can get free or discounted travel.

If you live in London and are 60 or over, you can apply for a 60+ Oyster card. This provides free travel on the London Underground, Overground, trams and buses, as well as some TfL Rail and National Rail services, but you can’t use it outside London. The card has a one-off £20 administration fee. You can apply online from two weeks before your 60th birthday. For more information about the application process see the TfL website.

Also once you are 60 or over, you can apply for a Senior Railcard. This currently costs £30 a year and gets you a third off most rail journeys, local and national. You can get more information and apply here.

Or if you’re 60 or over and make regular use of National Express coaches, you can buy a Senior Coachcard which costs £12.50 (plus 2.50 p&p) and offers a third off travel throughout the year. With this card you can also buy a £15 day-return on Tuesdays, Wednesdays and Thursdays to anywhere in the UK (excluding airports) as long as you book three days in advance. You can apply for a Senior Coachcard via the National Express website.

As always, if you have any comments or questions about this post, please leave them below. Happy travels!

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Could you get Attendance Allowance?

Could You Get Attendance Allowance?

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Attendance Allowance is a UK welfare benefit available to people who have reached state pension age who need help caring for themselves due to illness or disability. If you haven’t yet reached state pension age, the equivalent benefit is Personal Independence Payment or PIP. It is thought that millions of older people who would be eligible for Attendance Allowance are not currently receiving it.

I recently helped an elderly friend submit an application for Attendance Allowance, so in this post I thought I would set out how the application process works and share some tips and advice based on my (thankfully successful) experience of claiming it.

But first, let’s deal with the basics…

How Much Is It?

Attendance Allowance is paid at two different rates according to how much help and care you need.

The lower rate (currently £58.70 a week) is paid to people who need frequent care throughout the day OR night

The higher rate (currently £87.65 a week) is paid if you need frequent care throughout the day AND night, or if you are terminally ill.

Payments are normally made every four weeks direct to your bank account. The money is yours to spend as you wish to make your life a bit easier.

It is worth noting that you do not need to have someone currently caring for you in order to claim. Eligibility is based on your need for care rather than whether you are actually receiving it.

Another important point is that Attendance Allowance is not means-tested – eligibility is based purely on your care needs. Also, it is not taxable and will not normally affect your entitlement to other welfare benefits. Indeed, you may also be eligible for extra Pension Credit, Housing Benefit or Council Tax Reduction if you receive Attendance Allowance.

How Do You Apply?

Attendance Allowance is administered by the Department for Work and Pensions (DWP) rather than local councils. In Northern Ireland the Department for Communities (DfC) has responsibility for it.

The bad news is that there is a long (31 pages) and complicated application form. You can either download this from the government website or you can phone them on 0800 731 0122 and ask for a form to be sent to you. In Northern Ireland you can download the form from this site or phone the Disability and Carers Service on 0800 587 0912. You can apply yourself or someone else can apply on your behalf (with your permission, of course)..

Whether to download the application form or request it by phone needs careful consideration, as both methods have their pros and cons.

If you download the form it will be as an editable PDF. That is the option I used for my friend’s application. It has the advantage that you can complete it on screen rather than by hand. If is therefore easy to edit and amend your answers. Then when you are ready you can print it, sign it where required, and submit it. As a matter of interest, I used the free Foxit Reader program to complete and edit the form on my PC.

On the other hand, if you request a printed application form, as long as you return it within six weeks (a deadline date will be marked on the form) the benefit – if awarded – will be backdated to when the form was sent out. If you download the form from the website, it will only be backdated to the date they receive it from you. So you could lose out on several weeks’ money you might otherwise have had.

One compromise would be to request the form by phone and download it from the website as well. You can then use the downloaded version to create and edit your answers on screen. Once you have a finished version you are happy with, you can copy this manually on to the paper form and submit it within the six-week deadline.

Top Tips for Filling in the Form

Based on my experiences helping my friend – and some additional research online – here are my top ten tips for completing the Attendance Allowance application form.

1. Don’t rush at it like the proverbial bull in a china shop. If you do, you will almost certainly make mistakes and forget things. If you requested the form by phone you have six weeks to complete and return it without any financial penalty, so take advantage of this.

2. Read the notes that come with the form before you start to complete it. This will help you understand what the assessors are looking for to determine whether you are eligible for the benefit (and at what rate).

3. Keep a diary for a few days at least (ideally a week). Record in this all the occasions on which you need help and support. For example, if you need help getting dressed or washing, note down when this happens and how many times a day.

4. Be honest about your care needs when completing the form. Bear in mind, though, that Attendance Allowance is awarded to people who need help with their personal care. Washing, showering, eating, getting dressed and going to the toilet would all be things to mention if you need help with them. On the other hand, things like washing clothes, cooking, washing-up, dusting and hoovering may not be viewed in the same light. While these tasks clearly have to be performed by someone, they probably wouldn’t be regarded as personal care needs. Neither does the allowance cover mobility needs.

5. In the relevant section (Question 25) you should list any aids and adaptations you need/use. These might include bath or stair rails, a hoist, a shower seat, a commode, a walking stick, a wheelchair or walking frame, and so on. If you have eyesight problems, they could also include a magnifying glass or an extra-bright daylight bulb. You should also write about these things in the relevant ‘care needs’ questions. For example, if you use a grab rail to get in and out of the shower, you should also mention this in Question 29, ‘Do you usually have difficulty, or do you need help with washing, bathing, showering or looking after your appearance?’ Don’t worry if you end up mentioning the same thing twice (or more) over.

6. Bear in mind that you don’t have to require continuous support to receive the benefit. The term used on the form is frequent, although this isn’t defined precisely. One question (in Q38) asks how long you can safely be left unsupervised. My friend and I decided that the honest answer to this was two to three hours, although the latter would only apply with careful advance preparation. We answered 2-3 hours maximum and this appeared to be acceptable.

7. In addition, it doesn’t matter who is providing your care currently. My friend was concerned that because her husband was her primary carer, she would not be eligible for Attendance Allowance, as this would be expected from a spouse anyway. That is emphatically not the case. No matter who is caring for you – or even if nobody currently is – that will not affect your eligibility for the benefit.

8. The form gives you the opportunity (in Q49) to include a statement about your care needs from someone who knows you well. It is obviously good to include this if you can. As a close family friend I filled in this part of the form myself, but other options might include a doctor, a nurse, a care assistant, a family member, a priest or chaplain, or even a neighbour. Obviously it is important that whoever does this understands what the form is for and the sort of care needs the assessors are looking for.

9. You can also include a letter (or letters) from a medical professional backing up your need for care and support. In the case of my friend, we included a copy of a letter from her main (respiratory) consultant regarding her latest appointment. Fortuitously this also listed all her other health conditions and included a brief medical history. If you don’t have something like this available, ask your GP or consultant if they will provide something for you.

10. Remember that care needs can be psychological as well as physical. If you need support to combat loneliness and depression (or worse), you can and should mention this on the form.

Submitting the Form

Once you have completed the form, you will need to send it by post (email is not acceptable). As I completed my friend’s form online, I printed it out and put it in a clear plastic wallet, then sent this is a large padded envelope.

The address to send it in England, Wales or Scotland is Freepost DWP Attendance Allowance. The address for Northern Ireland will be on the form.

Don’t expect a quick response to your application. It is likely to be six to eight weeks before you hear anything, though you can if you wish phone to check that they have received it.

As mentioned, if your application is successful your benefit will be backdated to the date the form was received or (if you originally requested it by phone and are within the six-week deadline) the date the printed form was sent out to you.

Thankfully my friend’s application was approved without any further investigation and she is now receiving the allowance. In some cases applicants are required to attend for a personal assessment. Information about this will be sent by letter.

If you are unsuccessful in your application, you can submit an appeal. Information about how to do this will be included with the letter informing you that your application has been unsuccessful. You will need to appeal in writing to the address given in the letter. Normally you have to submit your appeal within a month of being turned down.

Other Resources

This has inevitably been a concise article, based on my experience of applying for Attendance Allowance on my friend’s behalf. If you need more information and guidance, there is plenty more online. Here are some useful websites to check out…

Government Attendance Allowance website

Which? Guide to Attendance Allowance

Citizens Advice Bureau

Age UK Guide to completing the Attendance Allowance form (PDF)

Carers UK Attendance Allowance Guide and Factsheet

In Conclusion

If you – or an elderly relative, friend or neighbour – may be eligible for Attendance Allowance, I hope this post has encouraged you to apply. The application form can appear daunting at first, but if you take your time and approach it in a calm and systematic way, it is perfectly do-able. The money is set aside for people in your situation, and it really can help make your life a little more comfortable.

I do, though, recommend enlisting some help with it if possible. Even if you are confident about completing the form, someone who knows you well may be able to suggest ways you need care and support that you might not have thought to mention yourself. And two heads are always better than one, of course! If you don’t have a suitable friend or relative, you can contact your local Citizens Advice Bureau and ask if they have someone who can assist you in completing the form.

As always, if you have any comments or questions (though bear in mind I make no claim to being an expert about Attendance Allowance!), please do leave them below as usual.

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How to save money on prescriptions

How to Save Money on Prescriptions

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The full cost of an NHS prescription in England is now £9. If you need regular medications, that can quickly add up to a substantial sum.

The good news, however, is that many people are entitled to free prescriptions, and others have methods open to them to save money.

Before I go into that, though, I should point out that all NHS prescriptions are now free in Scotland, Wales and Northern Ireland. So if you are lucky enough to live in one of these countries, you won’t normally be required to pay for your prescriptions.

Who Is Eligible for Free Prescriptions in England?

Here is a list of everyone eligible for free prescriptions in England, taken from the NHS website:

You can get free NHS prescriptions if, at the time the prescription is dispensed, you:

  • are 60 or over
  • are under 16
  • are 16 to 18 and in full-time education
  • are pregnant or have had a baby in the previous 12 months and have a valid maternity exemption certificate (MatEx)
  • have a specified medical condition (see below) and have a valid medical exemption certificate (MedEx)
  • have a continuing physical disability that prevents you going out without help from another person and have a valid MedEx
  • hold a valid war pension exemption certificate and the prescription is for your accepted disability
  • are an NHS inpatient

The medical conditions which qualify you for free prescriptions include cancer, diabetes (unless treated by diet only) and hyperthyroidism. For the full list, see this web page from the NHS Business Services Authority. If this applies to you, you will need to complete an application form FP92A from your GP, who will also sign it to confirm that you have the qualifying condition stated. Certificates are valid for five years, and once you have one you will be eligible for free prescriptions for any condition, not just the one through which you qualified.

You’re also entitled to free prescriptions if you or your partner (including civil partner) receive, or you’re under the age of 20 and the dependant of someone receiving:

  • Income Support
  • income-based Jobseeker’s Allowance
  • income-related Employment and Support Allowance
  • Pension Credit Guarantee Credit
  • Universal Credit and meet the criteria

Finally, you will qualify for free prescriptions if you’re entitled to or named on:

  • a valid NHS tax credit exemption certificate – if you do not have a certificate, you can show your award notice; you qualify if you get Child Tax Credits, Working Tax Credits with a disability element (or both), and have income for tax credit purposes of £15,276 or less
  • a valid NHS certificate for full help with health costs (HC2)

People named on an NHS certificate for partial help with health costs (HC3) may also get help with prescription costs.

What If You Don’t Qualify for Free Prescriptions?

If you don’t qualify for free prescriptions on any of the grounds set out above, there are still some things you can do to reduce the cost of your prescriptions.

One is to buy a Prescription Prepayment Certificate (PPC). These are available for three months or a year and entitle you to free NHS prescriptions for all conditions during this time.

At the time of writing a three-month PPC costs £29.10 and a year’s costs £104. In general, if you need more than one prescription a month and have to pay for it, a PPC will work out cheaper.

If you have a long-term condition, a one-year certificate will usually represent the best value. A person getting two prescriptions a month would save more than £100 a year by this means compared with paying for individual prescriptions. The simplest way to get a Prescription Prepayment Certificate is to apply via the NHS Prescriptions website.

Finally, it’s worth bearing in mind that some medications, especially for minor conditions, are available over the counter without a prescription. This can often work out cheaper than paying a prescription charge.

As always, if you have any comments or questions about this post, please do leave them below.

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Infographic: Are you a victim of pension mis-selling?

Infographic: Are You a Victim of Pension Mis-Selling?

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Today I have an eye-opening infographic for you from my friends at Edinburgh IFA about pension mis-selling.

If you watch the TV news, you may be aware that there has been a spate of stories in recent months about pension mis-selling.

In particular, some people have been persuaded to transfer valuable final salary pensions to unsuitable, often high risk, investment schemes, potentially putting their future income and security at risk. Of course, the advisers concerned typically pocket large sums in commission for this.

There is, however, some hope for victims of pension mis-selling, as the government has set up a compensation fund to help them. Here is the infographic with further information.

Mis-Sold Pensions

Thank you to Edinburgh IFA for their detailed and informative infographic.

If you think you (or a friend/relative) may have been mis-sold a pension or badly advised about a pension transfer, then – as the graphic says – you may be eligible for compensation from a £120 million fund set up for this purpose by the government. You can make a claim to the Financial Services Compensation Scheme (FSCS) or the Financial Ombudsman Service (FOS).

The FSCS only looks at complaints if an organisation has entered liquidation or administration. If – as is more likely – the organisation you wish to complain about is still trading, you will need to apply to the FOS.

You do need to act quickly, as if you are going to complain there is a time limit of six years from when the product was sold to you, or three years from when you noticed that you had been mis-sold – whichever is the later.

If you wish to complain about being mis-sold a pension, the first step is to contact the adviser (or SIPP provider) in question. They are obliged by law to have a complaints procedure and respond within eight weeks. If they don’t respond, or you are unhappy with their response, you can then file a complaint with the FOS. If they agree that you were badly advised, they can award you compensation of up to £150,000. More detailed information about the complaints procedure is available on the Edinburgh IFA website.

If you don’t feel confident going to the Pensions Ombudsman yourself, you can use a claims adviser. Edinburgh IFA say they are happy to put anyone in this position in touch with an independent financial adviser (IFA) in their area who will provide initial advice free and without obligation. Despite the company name, they offer a nationwide service (not just Edinburgh!).

Or if you don’t want to use them, any IFA specialising in pensions should also be able to help you. The website Unbiased.co.uk can locate suitable independent financial advisers in your area for you.

Either way, if you think you have been a victim of pension mis-selling, don’t bury your head in the sand. Compensation may be available if you act now. In any event, it costs nothing to find out more.

As always, if you have any comments or questions about this post, please do leave them below.

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Could you benefit from the tax-free trading allowance?

Could You Benefit from the Tax-Free Trading Allowance?

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Today I want to share some information about the trading allowance, a modest but useful tax-free allowance.

The trading allowance doesn’t appear to be widely known about, but can be particularly relevant for retired and semi-retired people. Though those in full-time work may also be able to benefit from it.

This allowance was introduced in the Finance Act (No. 2) 2017, which from April 2017 brought in a £1,000 trading allowance and £1,000 rental allowance. The trading allowance is likely to be the more beneficial of the two (at least, unless or until the much more generous £7,500 Rent-a-Room allowance is abolished) so in this post I will focus on that.

The trading allowance means that from April 2017 individuals with a trading income of £1,000 or less in a tax year do not need to declare or pay tax on this money. Trading income can include money from online activities such as auction trading, blogging, completing online surveys, and so on. It would also include casual work such as gardening or DIY.

So long as you earn under £1,000 a year from these activities, the good news is you don’t have to declare it to HMRC or pay income tax on it. For people who only earn small amounts of income from trading – perhaps on an ad hoc basis – that means there is no more worry about if, how or when to declare it to the authorities. I know many older people worry about whether they will get into trouble if, for example, they do a small DIY job for a neighbour and are paid £50 for it. The trading allowance can remove this source of concern.

An important point to note is that the £1,000 refers to gross income. If you intend to claim the trading allowance, you aren’t allowed to deduct any costs incurred (as of course you would in a normal self-employed business).

If you earn over £1,000 gross from trading you can still use the trading allowance if you wish. You then simply deduct £1,000 from your gross income and that will give your taxable income. Alternatively, you can choose the traditional method of deducting all business-related expenses from your gross income and paying tax (if due) on the balance. Clearly if you have a high level of expenses, the latter is likely to be the more cost-effective choice. Here are a few examples that may help make this clearer.

1. Graham is retired and supplements his pension doing part-time gardening for his neighbours, for which he earns £900 a year. This is under £1,000, so he does not have to declare this money to HMRC or pay any tax on it.

2. Jill has a part-time job working for an employer and in her spare time runs a blog, from which she makes a gross income of £1,500 a year. She has £600 of blog-related expenses. Although her net income from her blog is under £1,000, because the gross income is over this figure she is obliged to register as self-employed with HMRC. She then has the option of deducting the £1,000 trading allowance from her £1,500 gross income, giving her a taxable income of £500. Alternatively she can choose to deduct her £600 of expenses from her gross income of £1,500, leaving her with a taxable income of £900. Clearly, in this case she is better off claiming the trading allowance.

3. Mary works full-time as a shop assistant but also has a sideline buying and selling collectibles on eBay. Her gross income from her eBay trading is £2,500 and she has trading costs of £1,250. Again, as her gross income is over £1,000, she has to register with HMRC. She then has the choice of deducting the £1,000 trading allowance from her gross trading income of £2,500, giving her a taxable income of £1,500. Alternatively she can deduct the £1,250 of expenses from her £2,500 gross income, leaving her with a taxable income of £1,250. Clearly, in this case, not claiming the trading allowance is the better option.

You are allowed to decide for yourself which option is more beneficial to you each year, so it is very important to keep careful records of all your trading income and expenditure.

Note also that everyone is entitled to claim the trading allowance however much they earn as an employee (if you are already self-employed you will probably be unable to claim it, though – see below).

Bear in mind also that everyone has a tax-free annual income allowance anyway – the basic personal allowance is £11,850 in the current tax year, going up to £12,500 in 2019/20. The trading allowance is only therefore likely to be relevant in financial terms if your total taxable income from all sources exceeds this. But you will of course still have the benefit of not needing to worry about notifying HMRC or registering with them if your gross trading income is under £1,000..

As ever, there are a few other complications…

  1. You can claim the trading allowance if you have another paid job for an employer, full-time or part-time. You can’t, however, claim it if you also do freelance work for your employer.
  2. In addition, if you run a separate self-employed business, it is unlikely you will be able to claim the trading allowance as well (your accountant should be able to advise you about this – see also this useful article from Accountancy Age).
  3. There is only one trading allowance per person. Even if you have two separate sources of income from trading, for the purposes of claiming the allowance the total income from them must be lumped together. However, you can allocate the £1,000 allowance across both activities in whatever proportion you wish.
  4. Although you don’t have to declare trading income below £1,000 per tax year to HMRC, you may still have to declare it if you are receiving other welfare benefits such as Universal Credit.
  5. Only individuals can claim this allowance, not partnerships or limited companies.

Further Reading

Here are a few additional resources you may find helpful, starting with the government’s own website devoted to this allowance.

Tax-free allowances on property and trading income (HMRC)

Q&A – How trading allowance tax exemption works (FT Adviser)

What is the Trading Allowance? (Low Incomes Tax Reform Group)

Trading Allowance (Tax Aid)

A Little Boost (Tax Adviser magazine)

As always, if you have any comments or questions about this post, please do leave them below (although bear in mind that I am not a qualified financial adviser or tax expert and cannot provide personal financial advice).

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SMI Change: What You Need to Know

Guest Post: SMI Change: What You Need to Know

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This is a guest post by Sara Williams, who blogs about debt and credit ratings at Debt Camel. She is also an adviser at Citizens Advice.

If you get government help with some of your mortgage costs, you should have heard that this help, known as Support for Mortgage Interest (SMI), is changing from April 2018. About half the people getting SMI are pensioners who get Pension Credit. Many of the rest are disabled.

At the moment the SMI help is given as a “benefit”. But from April 2018, it will only be given as a loan that is secured on your house, so it has to be repaid when the house is sold.

This may sound very worrying. And some people are saying that it isn’t being explained very well by Serco, the firm the DWP is using to try to persuade people to sign the new loan documentation.

With only 6 weeks to go until the change, less than 5% of the people getting SMI have agreed to the new loan. And for people who don’t agree, their SMI will stop in April. This could mean people getting into mortgage arrears and ultimately having their house repossessed.

Questions people ask about the SMI change

Hundreds of comments have been left on an article I wrote about this SMI change. Here are some of the questions people are asking:

How much help will I get?

The same as now. Whatever SMI is currently paid to your mortgage lender, the same amount will be paid after April if you agree to the new loan.

But I’ll need more money each month as interest is now being added to this new loan?

You don’t have to start repaying this new loan, or the interest on it until your house is sold. So on an everyday basis, you will be in the same position as you are now.

Will the interest rate on the new loan increase?

The interest on the will be fixed to the UK Gilt rate – at the start it will be 1.7%. This is the rate at which the UK government can borrow – it will always be cheaper than most mortgage rates.

The loan is from the government, you don’t need to worry that Serco will change these rules and charge you more.

Will there be a delay before it’s paid?

If you are already getting SMI, the switch to the loan will be seamless; there won’t be any months when you aren’t helped.

If you aren’t currently getting SMI, the same waiting period of 39 weeks will apply as now.

Can I repay it if I get a new job?

Yes, you can repay the loan, or part of it, at any time. But it may be better to overpay your mortgage if you have spare money, as your mortgage rate will probably be higher than the interest rate on the SMI loan.

What other options are there?

Some options include:

  • ask friends or family to help you with your mortgage costs – this isn’t possible for many people;
  • get a lodger – but this could reduce your other benefits so get advice from Citizens Advice before deciding to do this;
  • use up your savings – but most people won’t have much and using what you have could leave you unable to afford an emergency;
  • sell the house and downsize or rent. This is a big change. It may be a good idea if your house is too large or difficult for you to manage or you have an interest-only mortgage ending soon, but you need advice on how it will affect your benefits first.

Should you agree to this?

I don’t like the change. I think it’s unfair and if people lose their homes, it could cost the government more money than it is supposed to save,

But you should make a pragmatic decision based on whether you have any better alternatives. Don’t be swayed by feelings about unfairness or politics.

Complain to your MP if you feel it’s unfair – these changes were discussed in Parliament, but they didn’t get much attention at the time – but don’t reject this loan without a better option.

The loan is cheap. Unless there are relatives who could help you, most people won’t have a good alternative. If you aren’t sure, or you have detailed questions, e.g. about what you are being asked to sign and its implications, go to your local Citizens Advice and ask for advice about the proposed loan and your finances, benefits and any other debts.

 

Thank you very much to Sara for a concise and informative article about the SMI change, which is clearly likely to affect some readers of this blog. If that includes you, with the new system coming in after 5 April 2018, it’s important to get to grips with the change and decide what is the best course of action for you.

If you have any comments, as always, feel free to post them below.



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