What is Universal Credit? | Howells Solicitors

What is Universal Credit?

On 11 January 2019 it was announced that the way payments of Universal Credit are calculated may be unfair. This announcement was made a following a successful judicial review brought in the High Court by four working single mothers. In response to the court’s decision the Government has said it will make payments more individual and regular. Further updates are awaited.

To explain what Universal Credit is, what benefits are affected and what if anything you need to do, our Benefits and Credits expert Marie Busfield has prepared some information to guide you through.

What is Universal Credit?

Universal Credit was first introduced in 2013. The idea behind it is to replace a number of existing benefits and to combine these into one single monthly payment.

The benefits that are being replaced by Universal Credit are;

  • Income Support
  • Income based Jobseekers Allowance
  • Income related Employment and Support Allowance
  • Child Tax Credit
  • Working Tax Credit
  • Housing Benefit
Who can claim universal credit?

Just like the benefits that it is replacing, Universal Credit can be claimed if someone is either working or unemployed.

Which benefits are not affected by Universal Credit?

These benefits are not affected by Universal Credit and can still be claimed and received in the same way in their own right.

  • Claims for Carers Allowance
  • Disability Living Allowance
  • Personal Independence Payment
  • Attendance Allowance
  • Council Tax Support
How do I claim Universal Credit?

Universal Credit is claimed and managed online. An assessment is done by looking at the income a person has and their household circumstances to work out their monthly payment. These payments are then paid on the same date each month.

If a person is renting a property they can apply for assistance with their housing costs through Universal Credit. This is in the same way that Housing Benefit would have previously been claimed. The only differences being that a claim would be made as part of the Universal Credit claim and paid as part of the total monthly payment.

When will Universal Credit start?

Universal Credit is being introduced on a rollout basis. There are therefore certain areas of the country where if a person wishes to make a new claim for any of the replaced benefits they will now only be able to claim Universal Credit.

What if I’m currently receiving benefits?

If a person is currently receiving any of the replaced benefits they do not need to do anything unless they have a change in their circumstances. If this happens a person should check the Universal Credit postcode checker. This will identify if they are in a full or partial rollout area and can be accessed here.

The changes in circumstances are things that may affect the amount of benefit that someone is entitled to receive. They may include someone moving in or out of their house, a change in their address or a change in their household income.

Following this the person claiming would need to contact the benefit provider for the benefit that they are claiming, this may be the Department for Work and Pensions, the Local Authority or HMRC. They will be able to confirm the claim that needs to be made and provide the details to do this.

If there are no changes to a person’s circumstances they do not need to take any action until the Department for Work and Pensions contacts them and invites them to make a new claim.

The managed migration of people currently claiming the benefits due to be replaced is not due to begin until June 2019. As part of this process the Government has introduced transitional protection for those receiving some of the replaced benefits. This is an additional amount paid so that the person claiming won’t lose out financially by being moved onto Universal Credit.

Marie Busfield

Benefits and Credits Team

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