Thursday 21 March 2013

Claim Benefits? Then Bank Charges are Unlawful

Many thanks to Catriona Grant for letting me know about this very useful piece of Tory legislation. This needs spreading far and wide.

Did you know that

Section 187 of the Social Security Administration Act 1992

There is an Act of Parliament which over-rides banks taking charges from your account if you are in receipt of any of the following benefits.

• Income Support
• Tax Credits
• Child Benefit
• Job seekers allowance
• Incapacity benefit
• Disability living allowance
• Attendance Allowance
• CSA payments
• Other DWP payments

These social security benefits are granted to stop hardship and are designed to meet basic day to day needs, and are exempt and are protected under the Social Security Administration Act 1992 sub section 187. from arrestment in terms of section 187 of the Social Security Administration Act 1992 (see Enforcement of Civil Obligations in Scotland, Scottish Executive report, at paragraph 5.245).

Section 45 of the Tax Credits Act 2002 Chapter 21 part 1 is an identical provision to the said section 187 of the 1992 Act. This stipulates that the banks can not apply any charges to money received as benefit, and any such charges are unlawful and therefore disallowed.

If you have any bank charges and in receipt of these benefits - write to your bank asking for your charges back.


Andy said...

I don't think this argument holds any water, see

Also, I think the explanation by Tom Brennan on this thread sums it up nicely

Another way of looking at it is that bank charges are a charge for a service, just like, say my mobile phone bill. Both are taken from the same place, my (overdrawn)bank account. Am I exempt from paying for my mobile phone too?

Amanda said...

This is just for Scotland, isn't it?

Amanda said...

It's ok. I see why you posted the Scottish information. Thanks

Cat said...

State benefits are a resolved matter so the act is UK wide. The section doesn't mean banks won't take charges out of your bank account - they will if you are over drawn etc however it is an argument that you should put forward when claiming back your charges or trying to solve your financial difficulties - if your bak does not give back unfoar charges under this act then complain to the odbundsman - you'll get your charges back.

Anonymous said...

Well, the comment is under moderation but the argument is not valid. If the issue is Financial hardship then I would suggest that whoever is suffering financial hardship uses "The Lending Code" section 9 under financial hardship. I was within the circle of the bank charges campaign under the username "natweststaffmember" and no "leclerc" and so the SSAA 1992 and the TCA 2002 argument. The wording of the first act is about assignment of monies, ie giving it to a third person by way of a charge. benefits are not assigned to any other person so the word "charge" is not in the sense of bank charges but in the sense of assigning away those benefits to a third person(that is in SSAA 1992, section 182). It is the same definition under the TCA 2002 part 45. Catriona, what you have quoted is done by many people but is actually legally unsound.

Anonymous said...

Sp is it against the law for them to take bank charges from your benefits or not in confused ??

Anonymous said...

I'm in receipt of income support, as I am my 86-yr old mother. I spoke to my bank, Santander, they told me that I wasn't able to claim back my bank charges, because I have a £50 overdraft. Can anyone tell me if this is correct please?
Many thanks

Phil said...

I would recommend looking at the terms and conditions of your account.

Anonymous said...

Some of my charges are for such miniscule amounts, it's ridiculous. For example... I missed calculated on a Dd going out, I was just 15p over my Old, and was charged £15. That then had a knock on effect. Thank you so much for taking the time out, to answer my query, much appreciated. I will have a read of the T's & C's...
Thanks again