Based on the facts given so far, the LA are just plain wrong. To make someone a "nil qualifier", they must have grounds (e.g. income too high / capital too high / no rent liability). There is no legal basis for simply deciding that someone is a "nil qualifier".
The only potential adverse effect of a late notification of a change of circs is if the change in beneficial to the clmt (i.e. the HB would increase). Normally, the higher HB would simply take effect from a later date than the actual date. But, even then, there is an exception to that rule which may be applicable in this case.
Assuming there is not more to this, I'll be happy to assist with the preparation of an appeal (no charge) if your client is looking to take this further. If this is of interest, just let me know below and I'll be happy to provide my contact details via the Congleton office.
Just one more thing - is the clmt in time for an appeal? My advice would be to get the appeal submitted ASAP (must be signed by the clmt). If you don't have grounds of appeal ready to submit immediately, get the appeal in anyway and state that grounds of appeal will follow.
Hope the above helps.
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