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Universal Credit is a new benefit being introduced across the UK in stages between 2013 and 2017. It will eventually replace the following benefits:
- Housing Benefit
- Income support (IS)
- Jobseekers Allowance (JSA)
- Employment and Support Allowance (ESA)
- Child Tax Credit and Working Tax Credit
- Budgeting loans and crisis loans
Universal Credit is for people of working age, designed to top up your income to a minimum level. You can claim as an individual or jointly as a couple. You usually have to be aged 18 or over to make a claim. Young people under the age of 18, students and people not usually resident in the UK are not usually able to claim but there are some exceptions.
You can't claim Universal Credit if both you and your partner are over pension credit age. You claim Pension Credit instead.
Providing your income and savings don't go above certain limits, you can carry on claiming Universal Credit if you are working or out of work.
Universal Credit may help people on low incomes who move in and out of work by reducing the problems caused by benefits stopping and starting.
Most claims for Universal Credit are made online. You are not entitled to Universal Credit if your income from other sources or savings is too high for you to qualify.
You cannot backdate your Universal Credit claim so it is important to make your claim immediately or as soon as possible.
To make a claim, you will need:
- Your National Insurance Number
- Details of the bank, building society or Post Office account you want your universal credit paid into
- Your tenancy agreement, if you have one
- Details of your savings or other capital
- Details of any other benefits you are getting
Help with paying your rent when universal credit is introduced
Universal credit is replacing housing benefit if you need help paying your rent and are of working age.
Your claim form includes help with housing costs, so a separate claim isn't needed.
Universal credit is usually paid directly to you each month. It is your responsibility to budget and pay your rent from your universal credit and any other income you may have.
There may be some circumstances when payments can be made direct to your landlord instead. If you have rent arrears, contact your landlord and Jobcentre Plus about direct payments. Your landlord can also contact Jobcentre Plus.
If you find that you are struggling to meet your rent payments when you are receiving Universal Credit you may be eligible for additional help from us. Please visit our Discretionary Housing Payment page for more information.
Help with mortgages when universal credit is introduced
You can get universal credit to help pay your mortgage interest, but only if you are not in paid work.
You will not get any money to help pay your mortgage for the first 9 months after you claim.
Universal credit claimants who have mortgages may have to reconsider their housing options if their benefits are too low to allow them to keep up with their payments.
If you do not keep up with mortgage payments, you could build up mortgage arrears and risk repossession.
Universal credit is paid monthly
Under universal credit, payments are made to you every month. They are made in arrears, not in advance. It may sometimes be possible for payments to be made more frequently, or to be split and paid to more than one person.
You will usually not be entitled to any payment for the first seven days after you claim.
It may take a while to get used to budgeting for a month at a time if you have been used to managing your money from week to week. If you need help to manage while you wait for your first payment, you may be able to claim a short-term advance of universal credit.
You must set up a bank, building society or credit union account to receive your universal credit payments.
Find out more from the Money Advice Service about opening a bank account
We can help you get advice on managing your money while you transition onto Universal Credit. Please contact us and ask about Personal Budgeting Support.
The benefit cap limits the amount paid
Universal credit is subject to the benefit cap.
Your universal credit can be reduced so that the total benefits you receive is not more than £2,167 per month for couples with children or lone parents, and £1,517 per month for a single person. The cap includes payments paid to help towards the rent or mortgage. Some benefits are excluded from the cap.
These benefit cap rates will be reduced, probably in autumn 2016.
Find out more about the benefit cap