The government is raising Universal Credit payments today, giving some relief to Brits struggling in the coronavirus pandemic.
As of Monday (April 6), millions of households around the UK will be better off.
The rise of 1.7 per cent brings an end to a five-year freeze on benefits going up. It was announced in October last year, following the release of inflation figures in September.
And it’s accompanied by a temporary rise of £20 a week, which forms part of Chancellor Rishi Sunak’s relief package for Brits struggling because of coronavirus.
What do the changes mean for me?
The Universal Credit standard allowance is increasing, as are Working Tax Credits. The government is also temporarily suspending the minimum income floor on Universal Credit.
The standard allowance is the amount that everyone accepted onto Universal Credit is entitled to.
From today, it is going up by around £20 per week for the next 12 months. This will give those receiving it an extra £1,000 during the course of the year. That’s £86.67 per month, in addition to the planned rise of 1.7 per cent.
For those who are single and under 25, it is rising from from £251.77 to £342.72.
Singles aged 25 or over will see it go from £317.82 to £409.89.
Couples who are joint claimants, both aged under 25, will see theirs go from £395.20 to £488.59.
And joint claimant couples, where one or both of them are over 25, will see payments increase from £498.89 to £594.04.
Working Tax Credit, now a legacy benefit since it was replaced by Universal Credit, will go up by the same amount. That’s on top of the 1.7 per cent rise linked to inflation.
Currently, the basic amount for Working Tax Credit is up to £1,960 a year. But for the next 12 months, that figure will be £3,040.
The Minimum Income Floor (MIF) is also being removed temporarily. This is to help self-employed people who are losing income because of the coronavirus lockdown.
It is available for self-employed people whose businesses have been in operation for over 12 months.
How do Universal Credit and Working Tax Credit work?
When it was introduced, Universal Credit replaced six existing benefits – among them, Housing Benefit and Working Tax Credit – with one payment.
Everyone accepted onto it gets the standard allowance. Claimants can potentially get more based on their circumstances, such as whether or not they have children or a disability.
Working Tax Credit payments depend on the hours of paid work the applicant does you do each week, along with their income and personal circumstances.
How can I apply for Universal Credit?
It’s currently recommended that claimants apply online on the Gov.uk website.
You will be asked about your income and housing situation. You will also be asked for proof of identity.
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