Business assets of an operational business
These include standard items such as:
• machinery
• vehicles
• fixtures
• business cash held in the bank (including money held following the sale of assets),
Items such as customer lists and contacts, current and future contracts and goodwill may also be included.
Any assets that are used wholly or mainly for the purposes of a claimant’s trade, profession or vocation are disregarded indefinitely whilst the business is still operating.
Personal injury compensation payments
If a person has been awarded a sum of money as a result of a personal injury to themself, the amount is disregarded as capital if the sum is either:
• held in trust
• administered by the court
Payments made from the Criminal Injuries Compensation Fund will also be disregarded.
Premises occupied as the home
Premises occupied by a person as their home are disregarded indefinitely. Usually, only one set of premises can be disregarded. In some limited
circumstances, more than one property can make up the premises occupied as their home.
Premises bought but not lived in as their home by the claimant or any member of the claimant's family cannot be disregarded as premises occupied as their home.
However, in limited circumstances, can be disregarded for other reasons - see below.
Premises usually occupied as the claimant’s home are disregarded if both of the following apply:
• they are not occupied for a time
• the intention is to return to live in the premises as the home
For example, if a person goes into residential care on a temporary basis and intends to return to the house they usually occupy as their home, the house is disregarded.
Croft land and small-holdings can be treated as part of the premises occupied as the home if they cannot be sold separately.
Life insurance policies
The value of a life insurance policy still in force is disregarded indefinitely.
Investments which include some life insurance are disregarded indefinitely if the agreement states how payment on death is worked out.
It does not matter whether the amount paid on death is more than, equal to, or less than the amount the person would get if the investment is surrendered the day before the date of death.
Money deposited with a housing association
Money deposited with a housing association is disregarded indefinitely if the money has to be deposited as a condition of living in the home. A housing association is a non-profit making voluntary body formed with the aim of providing good quality low cost housing.
Occupational and personal pensions
Any occupational or personal pension fund which the claimant has.
Important Note – the disregard only applies to the value of pension fund that the claimant and/or his employer has paid into, this protects investments for retirement. It does not apply to money drawn out of the pension fund. Any income payments from a pension fund or annuity payments will be taken into account as unearned income and any lump sum draw-downs from a pension fund will be taken into account as capital in the Universal Credit assessment.
If the person has reached the qualifying age for State Pension Credit and not purchased an annuity with their occupational or personal pension, a notional income will be taken into account when calculating their Universal Credit.
Payment made to holders of the Victoria Cross or George Cross
Any payment made to people because they hold the Victoria Cross or George Cross is disregarded indefinitely.
Payment made to former child migrants
Any payment made to a former child migrant who was alive on 1st March 2018, or the beneficiaries of any former child migrant who was alive on 1st March 2018 and has since passed away, is disregarded indefinitely.
The claimant must have been a child migrant from the United Kingdom, sent by a church, state, voluntary or other organisation to one of the receiving countries and they were not accompanied by an adult family member or sent to live with a member of their birth family.
Each former child migrant will receive a one-off payment of £20,000.
Information from the Child Migrants Trust about former child migrants is acceptable proof of the claimant’s eligibility for payment.
Any payment that a former child migrant may have received from any other scheme in any country is not taken into account. However, each claimant must be resident in Great Britain.
The scheme started accepting applications in March 2019 and began paying out in April 2019. It will remain open for 2 years.
Premises lived in by a close relative
Premises that are occupied as a home by a close relative are disregarded indefinitely if it is their only home and the close relative has:
• Limited Capability for Work, or
• Has reached the qualifying age for State Pension Credit
A close relative means:
• parent
• parent-in-law
• son
• son-in-law
• daughter
• daughter-in-law
• step-parent
• step-son
• step-daughter
• brother
• sister
or where any of the above is a member of a couple, the other member of the couple.
Premises occupied by former partner
Premises that are occupied by a former partner as their home are disregarded indefinitely if it is their only home and:
• the person and their former partner are not estranged but are living apart by force of circumstances, for example where the person is in long-term care
• the person’s former partner is a lone parent and occupies the premises as their home
Special compensation schemes
Any payment of capital from one of a specified type of compensation scheme will be disregarded indefinitely for the calculation of capital.
The compensation schemes are those established or approved by the Secretary of State or from a trust established with funds provided by the Secretary of State and providing compensation in respect of:
• a person having been diagnosed with variant Creutzfeldt-Jakob disease
• a person being infected from contaminated blood products
• the 7th July 2005 London bombings
• persons who have been interned or suffered forced labour, injury, property loss or loss of a child during the Second World War
• supporting persons with a disability to live independently in their accommodation
• Windrush Compensation Scheme and Windrush Exceptional Payments Scheme
If a claim for Universal Credit is made by a partner, parent son or daughter of a person having been diagnosed with variant Creutzfeldt-Jacob disease or infected from contaminated blood products.
A payment of capital received from any of the following is disregarded as capital if it would be disregarded in relation to an award of State Pension Credit:
• the scheme or trust in respect of the diagnosed or infected person
• the diagnosed or infected person, or
• the estate of the diagnosed or infected person.
The We Love Manchester Emergency Fund
The We Love Manchester Emergency Fund was set up following the attack in Manchester on 22nd May 2017. All payments made from the fund can be fully disregarded from 19th June 2017. The disregard applies to all payments from the We Love Manchester Fund regardless of whom they are paid to.
Any payments made before 19th June 2017 are ignored as the Treasury has given authority to carry on paying benefits without taking the payments into account on an ex-statutory basis.
The London Emergencies Trust
The London Emergency Trust (LET) is providing relief for those directly affected by terrorism in London.
Payments made by the LET for the terrorist attacks on 22nd March 2017 (Westminster Bridge) or 3rd June 2017 (London Bridge) can be disregarded in full from 19th June 2017.
The disregard applies to payments from the LET Capital disregarded for an extended period
Arrears of benefit and tax credits or compensation for non-payment of £5,000 or more due to official
Arrears of benefit, Tax Credits or compensation for non-payment of £5,000 or more paid due to official error or error of law can be disregarded for the length of the Universal Credit award. The disregard applies to regardless of whom they are paid to. Any payments made before 19th June 2017 are ignored as the Treasury has given authority to carry on paying benefits without taking the payments into account on an ex-statutory basis.
Grenfell Tower Residents’ Discretionary Fund and/or other charitable payments made to victims of the tragedy
Following the Grenfell Tower tragedy on 14th June 2017, an extra-statutory provision applies to anyone in receipt of income-related benefits who have received compensation payments from:
• the Grenfell Tower Residents’ Discretionary Fund
• other charitable payments made to victims of the tragedy. Information on these charities is available on GOV.UK
If the charity concerned is not on the above GOV.UK list, the payment can still be disregarded if it is established that they relate to the Grenfell Tower
tragedy. Any payments made to claimants through these schemes must be disregarded from capital calculations indefinitely.
Funeral plan contract
The value of a funeral plan contract is disregarded indefinitely. ‘Funeral plan contract’ means a contract where a person makes payments to secure the
provision of a funeral and where the sole purpose of the plan is to provide for a funeral.
Young Carer Grant (Scottish Devolution)
Young Carer Grant is a long term Scottish Government benefit, payable to young people aged 16 to 18 who have significant caring responsibilities. There is no DWP equivalent. It is disregarded indefinitely.
Child abuse compensation programmes
Any payments made from schemes under the following child abuse compensation programmes are now fully disregarded:
• The Historical Institutional Abuse (Northern Ireland) Act 2019
• The Redress for Survivors (Historical Child Abuse in Care) (Scotland) Act 2021; and
• The London Borough of Lambeth’s Children’s Home Redress Scheme.