Cohabitation can lead to loss of some benefit payments

Q. I am 67 and receive my State Pension with a top up of Guaranteed Pension Credit as well as PIP for care.

Benefits will have to be reviewed once a couple start to live together.
Benefits will have to be reviewed once a couple start to live together.

I rent my property and currently receive full council tax reduction and housing benefit. My partner is considering moving in with me but she is 63 and gets ESA as well as PIP. I have been told that if she were to move in with me all my benefits would end and I may have to claim Universal Credit, is this correct or am I ok because I currently get Pension Credit?

A. You would need to report to the DWP if you commence cohabitation and this will lead to a revision of your current benefits. As you are a mixed aged couple for benefit purposes (one person is of pension age and the other below) then you will end up having to end your Pension Credit Claim and you will also have your housing benefit claim terminated. Your PIP will remain as will your partner’s. You would then have to submit a joint claim for Universal Credit for help towards living and rental costs. The calculation for living costs on Universal Credit differs from that of Pension Credit so it is likely that you will be worse off if you claim as a couple. You did not state if your partner is receiving Income Based or Contribution Based ESA and this will have a bearing on the calculation of Universal Credit. In this situation I would advise you seek advice and have a benefit check carried out to see what the position would be if you did decide to cohabit. You should both also bear in mind other help you may currently get that may be lost, for example free dental care, eye tests, etc.

Q. I recently received some backdated benefit arrears as the DWP were not paying me the Severe Disability Premium with my ESA. The arrears were almost £12,000 and I am worried I’ll lose or see my benefits reduced but the DWP stated in this situation the money is ignored. Is this correct?

A. The advice is correct, arrears of underpaid benefit are not classed as capital in this situation, you should have always been paid this money but were not due to some type of error. So although the money you receive is a “one off lump sum” it is not classed as capital and will not generate tariff income either. This is also true for other means tested benefits you may receive such as Housing Benefit, Council Tax Reduction, etc.