Incapacity Benefit and selling off business assests. Have I done anything wrong?

[sadone]

I've been claiming contributions based incapacity benefit now for about five years due to a mixture of illnesses. I used to work in the film and TV industry making props and doing effects work and during my career I've managed to build up a very large collection of props and molds that I'd made for TV shows and movies etc. When I ceased trading due to my illness I decided to slowly sell off my collection to other prop company's to help keep myself afloat. On average I've been releasing about 4 or 5 items a year which has got me roughly about £4,000 to £6,000 a year. I do not claim any other benefits apart from IB and I haven't been selling anything but items that I already owned and were part of my old business stock.

 

I didn't bother to tell the DWP that I was doing this as I was told by citizens advice that contributions IB wasn't means tested and that so long as I wasn't working I could dispose of my business assets without any problem. Is this correct? Should I have informed the DWP at the very start (a bit late now I know) and say what I've been doing?

Edited December 22, 2010 by sadone

[sadone]

Any ideas?

[Two4Tuesday]

Since IB is a taxable benefit, and you have been making at least another £4000 per annum from these sales, perhaps you should have at least informed HMRC as the income would have gone over your tax free allowance.

[sadone]

I have been declaring it on my tax returns since I started doing this. As It's not work but sales of what I already own my accountant said It's only liable to capital gains tax, which according to him I'm well under the limit.

[Surfer01]

There may be an issue if your assets are in excess of a specific amount in the first yeat for example.

[sadone]

In what way? Oh dear you've worried me now. Do you mean because of incapacity benefits or tax?

Don't say the CAB have given me the wrong advice.

[Surfer01]

I am not sure of the amount, but benefits could be affected if you have assets over a certain value. For example if benefits are affected by assets in excess of £6000 and this includes all assets then there may be an issue. Remember this is a guess and it could be assets over £16,000.

There are others who can give better advice than msyelf, but most are away for the holidays however thsi responce shoudl bump you back to the top of the forum.

[sadone]

To the best of my knowledge (and by what CAB told me way back then) that only applies to means tested benefits, and not to non means tested benefits such as contributions based Incapacity benefit. Basically as it is you used to be able to have loads of money in savings etc and still claim it, as It's about your inability to work, and not on how much you have money you have in the bank.

 

I'm more concerned that they might mistake what I did for trading and thus working, more the anything else.

 

Thing is I only let out a few items a year, and I don't buy anything new to then go on and re sell though. I'm down to my last few bits and pieces now and after they're gone, that'l be it.

Edited December 27, 2010 by sadone

[watchinginvestigation2010]

I thought you got contribution based for six months and then it changed to dependant on income, from reading I get the impression you have been claiming for some time, how can it still be contribution not income related?

[sadone]

That applies to ESA and job seekers I believe, not the 'old fashioned' Contributions incapacity benefit that I'm on. But due to the new changes even that will change from 2012 onwards, when even contributions based incapacity claimants will be means tested after one year, set retrospectively.