Council want to claim back housing benefit

Aug 15, 2011
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Dear Forum,

Since January 2009 I have been claiming Housing Benefit as was forced to move away for personal reasons, too many brick through my window.

Prior to moving I asked the local council for a discision in principle as my case is a little complicated, due to having 3 rental properties, all in massive negative equity as had to remortgage to fight a legal custody battle. I also have a 1% share in a ltd company, but for neither business I have never drawn a salary.

My problem now is that since April I have been put through the mill by the local council on every aspect of my income and expenditure and as such they believe that I have a different profit for the rental business as they wont except numerous expenses such as bank charges relating to paying money in. It has taken until the beginning of this month for them to finally pay my normal rate of LHA, however on the same day, I get a letter saying that I now owe over £12k for housing and council tax benefit, as they simply have not calulated my income and expenses correctly for the 1% share in LTD company I have.

I'm now getting £34 pw to pay a rent of £1,100 for myself and son, but then they will recover this at £22 pw leaving me £12 pw and for some reason 1p for council tax.

The stress is unbearable, and my son has had to stay with grandparents for the past week, as I cant focus or afford to eat.

My question, which I have many, but I would like to know, is that if I havent actually submitted my last years accounts for 2010 and give up my 1% share in the company, will that be deemed as not being able to draw a salary.

I want to stay as the company director as have put many years in trying to rebuild the business, but I cant let myself be destroyed and more importantly my son due to the council telling me I'm drawing a salary from the company, as they deem Internet and phone use as both business and personal and as such they have made the assumption that I can draw a salary.

The company is a website that made approximately 2.5k profit in 2010, the other 99% share holder is my mother as she bailed me out and set up funds to enable the site to survive.

Sorry for the long email, but I don't know what to do, I cant pay back the money or live in a house which I signed a new tenancy in April, as the council wrote to me telling me my new benefits, plus investigated me last year with no issues, but every penny of expenses is being taken away and told is my salary - such as £33 for postage, as even though I have receipts I cant proof that companies house etc have received the letters I've sent.

CAB tell me that I have to pay, but with an IVA of over 40k and my only income as working tax credits and child tax credits as a single parent, I know I'm soon going to be bankrupt and homeless.

I'm trying to write my appeal and provide accurate accounts for the company, but these are not due until the end of September for Companies House and are actually made up by my mother who is the company secreatary and is unable to do anything until the 5th September.

I dont draw a salary, I dont have a PAYE number dont pay NI dont know what to do but I'm exhausted trying to tell the council that I dont have the income they say I have. I dont know if anyone can make any advice or comments, sorry for the waffling on.

thank you


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