Have a patient being treated for cancer. He has applied for Council Tax benefit due to current low income. However, prior to his diagnosis he was in full time work and making great efforts to pay off his mortgage early. He has a Virgin One account (offsets saving against mortgage balance) and has paid off £18k over and above his usual monthly repayments. Local Authority treating this as £18k savings as he could potentially draw on this amount. Patient says he is being penalised and is not a happy bunny. LA have not provided guidance or seem inclined to budge. Patient wants to appeal. Does this come under the notional capital regs. Does anyone out there have any experience of this situation?

My (albeit relatively limited) understanding of Virgin One accounts is that they should be treated as any other account. If an account holder puts money in, that is capital. Any money that *may* be available over and above that is not capital - much like the overdraft facility on a normal bank account.

In the circumstances described in this case, the clmt does not have the capital. He merely has the equivalent of an overdraft facility. If that is correct, there is no capital to be taken into account and the LA is therefore wrong.

As an aside, there is a separate issue of notional capital. Even if the LA did not consider this originally, any appeal allows the LA to rely on different grounds in revising a decision. However, in order to arrive at a decision that any notional capital should be taken into account, the LA will have to show that, in disposing of such capital, there was "a significant operative purpose" for increasing, or obtaining, HB/CTB.

Hope this helps.