Universal Credit

Universal Credit is part of the United Kingdom Social Security system. It was started in 2013 to replace six benefits for working-age people with a low income: income-related Employment and Support Allowance, income-based Jobseeker's Allowance, and Income Support; Child Tax Credit and Working Tax Credit; and Housing Benefit. Like them it is means tested.[1]

It is paid to families once a month and is designed to help people to work as much as they can. People under 25 get less. An extra amount is paid for children, but only for 2 unless they were born before 6 April 2017, are adopted or are born as part of a multiple birth. Extra money is paid for disabled people, disabled children and carers.

People who are working can claim back up to 85% of their childcare costs. People who are responsible for a child or young person or living with a disability or health condition that affects their ability to work get a ‘work allowance’. Each £1 earned (above the monthly work allowance if there is one) reduces the payment by 55p. Universal Credit is paid monthly. People who are paid 4 weekly will get 2 sets of wages in one assessment period once a year, which will reduce their Universal Credit payment.

There is money for rent and some service charges.[2]

People who are able to work must look for work or increase their earnings or their payment may be reduced. Self employed people are generally given a minimum income floor. This is treated as their income each month that their reported income is less.[3]

Claims are generally made and managed online. Citizens Advice are paid by the government to help people to claim. [4]

5.7 million people were getting Universal Credit in July 2022. 30% were not required to work. Half the households had children. The average monthly payment was £810.[5]