I have a client who owns a property outright in Scotland which he bought using Criminal Injuries Compension approx 5 years ago. He bought it so that his elderly father who lives there and has done for over 40yrs was not evicted. A brother who owned the property previously was not able to keep up the repayments.
The client lives in london and rents a housing association property and makes no money from the property in scotland but because he owns it he currently cannot claim benefits as it would be counted as capital taking him over the capital limits. The client is unable to work due to the severity of his injuries. His only income is IB/DLA. His criminal injuries compensation is in a trust fund but he receives monthly payouts of £215.
If he were to transfer this property in scotland over to his father I am assuming he would still not be able to claim IS/HB/CTB benefit as he will be seen as depriving himself of capital to get benefits?

Are you implying that the house has a mortgage (or whatever the Scottish equvalent is)? If so, how does that affect valuation?

If his father is over 60 or is incapacitated the value of the property is disregarded - it doesn't affect means-tested benefits at all. Schedule 6 of HB Regs, para 4a. He doesn't need to do anything with the property.

Thankyou both for your postings. I just wanted to check something, I have looked up the rules about the property been disregarded due to the father been over 60yrs old and it states that the disregard only applied if the claimant previously occupied the property, as far as Im aware he would only have lived there as child as it was the family home so would that still count !?

The circumstances you describe might suggest a deprivation issue.

But is it necessary? It is the "market value" of the property that counts, which for benefit purposes is not necessarily the same as commercial market value. Ask yourself this: How much would someone pay for a property that has a sitting tenant who is, presumably, entitled to occupy the property for the rest of his life? You might benefit from housing law advice.

See this post where I've commented previously about market value:

http://www.rightsnet.org.uk/dc/dcboard.php?az=show_topic&forum=105&topic_id=1212&mesg_id=1212&page=

Just a thought, but in the circumstances it would seen perfectly reasonable (and not "contrived") for your client to charge his father the going rate in rent, and for dad (who I am guessing is in receipt of Pension Credit?) to claim the whole amount in Housing Benefit. This makes your client better off by £400 a month or whatever is acceptable, while dad is no worse off than before.

Derbyshire. Your suggestion might not be 'contrived' as such, but might an LA consider that the liability to pay rent was created to take advantage of housing benefit?

Hmm...not sure where you're getting that from. I see no such proviso in the relevant part of the schedule. It just refers to "premises" owned by the claimant - no apparent requirement for the claimant to have lived there that I can see.

I agree with Andy. Paragraph 4(a) says nothing about previously living there but merely mentions ownership. Thus it should be disregarded and no further action needs to be taken.

Furthermore, transferring the legal title to his father does not of itself transfer the son’s beneficial interest so deprivation doesn’t come into it.