What is it?
Universal Credit is for people of working age, designed to top up your income to a minimum level and help you with your housing costs (rent and some service charges). Universal Credit is for people on a low to moderate income. It does not matter whether you are working or not, or the reason why you are not working.
Universal Credit is replacing these benefits:
- Housing Benefit
- Income Support
- Income-Based Jobseekers Allowance
- Income-Related Employment and Support Allowance
- Child Tax Credit
- Working Tax Credit
IMPORTANT: Universal Credit does not include help with your Council Tax. You must claim Council Tax Support separately, from your local council.
Universal Credit is paid in one lump sum and on a monthly basis, and includes help to pay your rent. This help isn’t paid separately, like Housing Benefit. And usually all the Universal Credit is paid straight to you, so you have to pay your rent out of this money.
Most people will get the same amount of money as they would have under the benefits listed above – it just looks like more because of the benefits all being paid together, including help with your housing costs (rent, mortgage interest and some service charges) and is paid monthly, all at once.
See the Frequently Asked Questions for how to get help with managing the change to Universal Credit.
When will I have to claim Universal Credit?
New claims for Universal Credit can now be made throughout the UK.
But, you will only need to claim Universal Credit if a change in your circumstances means you would normally need to make a new claim for any of the benefits which are being replaced by Universal Credit. And you are not caught by what is called the ‘Severe Disability Premium Gateway’ rules (see below).
So, for example, if your Income Related Employment and Support Allowance ends because you have been found fit for work, then unless you caught by the ‘Severe Disability Premium Gateway’ rules, you will not be able to make to make a new claim for Income Based Jobseekers Allowance – this will have to be Universal Credit instead. If you make a claim for Universal Credit and you have been getting Housing Benefit and / or Child Tax Credit, these will stop too. Even if you appeal the Employment and Support Allowance decision and you win your appeal, if you have claimed Universal Credit you will not be able to go back onto Employment and Support Allowance, but your Universal Credit award may increase and your Claimant Commitment should be amended to reflect that you are no longer claiming as a jobseeker.
If your Employment and Support Allowance ends because you are found fit for work, contact us for advice. Some people, depending on their circumstances, might be better off if they do not make a new claim for benefit while they are waiting for the first part of the challenging process (known as mandatory reconsideration) to be completed. Once they have the mandatory reconsideration decision, they can lodge an appeal. They can then request payments of their ESA to be reinstated. As long as they have not made a claim for Universal Credit, and they are not affected by the ‘repeat fit for work decision’ rules (check with us if you are not sure), their ESA can be put back into payment. And if they have provided 'fit' (sick) notes since their ESA ended, they can receive payments covering the whole period. Anyone who decides this is the better option for them should ensure their Housing Benefit claim continues by letting the Housing Benefit office know they have no income until they can get payments of their ESA claim re-started.
Another change which would mean you need to make a claim for Universal Credit would be if you get Housing Benefit and you move to another rented house in a different local authority area,In this case you would have to look at claiming Universal Credit instead of making a new claim for Housing Benefit; any Income Support / Income Related Employment and Support Allowance / Income Based Jobseekers Allowance or Tax Credits would also end.
If you are already getting the benefits which are being replaced by Universal Credit and you continue to be entitled to these you may not need to claim Universal Credit until the ‘migration’ stage, sometime between 2019 and 2023.
However, (unless you have 3 or more children) – you can choose to move to Universal Credit at any time do not need to wait until a change in your circumstances means you have to. So you could get advice to check if you would be better off on Universal Credit – but seek advice before making any decisions!
What are the Severe Disability Premium Gateway rules?
These rules prevent anyone who is currently getting (or who recently got) a Severe Disability Premium* in an award of benefit, from losing that addition if they made a new claim for Universal Credit due to a change in their circumstances (as there is no exact equivalent in UC).
*The Severe Disability Premium is an extra amount included in an award of certain benefits given to claimants with a recognised need for care but no-one who is caring or can care for them.
So this 'Gateway Rule' says that anyone who is in the following situations will not be able to make a new claim for Universal Credit:
- They have the Severe Disability Premium included in their Income-Related Employment and Support Allowance, Income-Based Jobseekers Allowance, Income Support or Housing Benefit,
- They have had in it included in a claim for one of these benefits in the past month and has continued to meet the qualifying conditions for it ever since,
- They still meet the qualifying conditions for it after having the change in circumstances that is triggering the need to claim extra help.
Instead, they will be able to remain on, or make a new claim for, Income-Related Employment and Support Allowance, Income-Based Jobseekers Allowance, Income Support, Tax Credits or Housing Benefit – and so will retain their Severe Disability Premium.
Who can get the Severe Disability Premium?
The Severe Disability Premium should be included when someone’s Income-Related Employment and Support Allowance, Income-Based Jobseekers Allowance, Income Support or Housing Benefit is assessed where all 3 of these situations apply:
- They are getting Daily Living Personal Independence Payment, mid or high rate care component of Disability Living Allowance, Armed Forces Independence Payment, or Constant Attendance Allowance,
- No-one gets paid Carers Allowance or has the Carer Element included in an award of Universal Credit for looking after them,
- They either live alone or are treated as living alone - ie certain household members are ignored such as dependent children, other household members getting one of the benefits listed above, and lodgers.
If you are not sure whether you are getting the Severe Disability Premium included when your benefits are assessed – or whether you are entitled to it (and many people do miss out on this addition) - then contact a benefits adviser or ask us for help.
How can I prepare for Universal Credit?
To prepare for Universal Credit think about:
- How you would manage to make a claim on-line – where you can go if you don’t have your own computer.
- Where you can go to build up your computer skills if you’ve never been online before.
- Setting up an email address – you will need to have one to be able to claim Universal Credit.
- How you will manage when the benefits that Universal Credit is replacing are paid to you as one payment on a monthly basis.
- How you will manage until you have received your first monthly payment (it will probably be a longer gap between payments than you have been used to – and the first payment will be one month and 7 days after your claim).
- How you will manage when you have to pay your rent to your landlord yourself.
- Opening a bank or credit union account. “Basic” bank accounts don’t allow you to overdraw but still charge for unmet direct debits (if there’s not enough money in the account when they come out).
See the Frequently Asked Questions for more information and advice on the help you might be able to receive. If you would like to talk through some of these issues, please don’t hesitate to please contact the Financial Inclusion Team on 0300 111 000 (Parkway Green) or 0800 633 5500 (Willow Park).