Gifted a house and home improvement loan?

Hi Star2017

Welcome to the forum.

You might want to have a look at the following FAQ which explains where everything is; www.benefitsandwork.co.uk/guides-for-claimants/faq/forum.

You pose an interesting question which is outside the remit of the forum, the answer would depend on a number of factors. We would advise you to seek help from your local Welfare Rights Organisation; advicelocal.uk , they will be able to take all your circumstances into consideration.

Gary

You will have 6 months to renovate the building prior to moving in before your IB ESA is affected. What you read about the loan for improvements being disregarded applies to Universal Credit and not to Legacy Benefits such as IB ESA. But if you borrowed under £6000 at a time and spent it on renovation before borrowing another amount under £6000 you would evade the capital rule. Here are the ESA regs. that apply ( Schedule 9 Para. 8 )
( also your relative definitely needs to get legal advice as you cannot give a house away without having big HMRC tax implications )
Premises which are to be repaired or altered
The law
52571 Premises which need essential repairs or alterations to make them fit for people to live in them as
the home are disregarded to give time for
1. the repairs or alterations to be done and
2. the people to start living in the premises
if they are going to live in the premises as the home. The period of disregard is 26 weeks or longer if it is
reasonable from the date the person first takes steps to get the premises repaired or altered1
.
1 ESA Regs, Sch 9, para 8
The premises
52572 The premises must be capable of being a dwelling which can be lived in as the home. The
disregard does not apply to
1. premises which are land even if people say they are making alterations to the land by building a house
on the land to live in as the home and
2. any part of the premises which a person is not going to live in as the home if the DM decides it
2.1 can be sold separately and
2.2 is reasonable for it to be sold separately.
Essential repairs or alterations
52573 Essential repairs or alterations are those which are needed to make the premises fit to live in as
the home by the person or a member of the person's family. For example, if the person is in a wheelchair
and the doorways in the house are not wide enough for the wheelchair to pass through the essential
alterations are the widening of the doorways so the person can move into the premises.