Universal Credit (UC) - Universal Credit and other benefits

Tax-Free Childcare

If you're getting Tax-free Childcare, your account will be closed as soon as you claim Universal Credit.

If you want to find out which scheme you're better off depending on your situation, use the childcare calculator on the GOV.UK.

Other benefits

If you are receiving any of these benefits, they will stop two weeks after you make your Universal Credit claim:

• Housing Benefit (England, Scotland, Wales) or Housing Benefit (Northern Ireland)
• income-related Jobseeker's Allowance (JSA)
• income-based Employment and Support Allowance (ESA) 
• Income Support

If you are getting Council Tax Reduction/Support, you should contact your council to let them know you've claimed Universal Credit.

Any other benefits you're getting should continue to be paid the same as usual.

Some people find they are better off on Universal Credit and some do not. The best way to check is to use the Turn2us Benefits Calculator to see what you';re able to get in and out of work. 

Use the Turn2us Benefits CalculatorTransitional protection

If you applied to Universal Credit due to your legacy benefits coming to an end, you might have been getting transitional protection payments since then. These payments make sure you were not worse off on Universal Credit than on your old benefits.

If you made a successful claim for Universal Credit after receiving a managed migration notice, you might be already getting the transitional protection payment. This additional amount in your Universal Credit payment is to make sure you weren’t worse off on UC than your old benefit.

You can lose your transitional protection in certain situations. You can read more about it in our Universal Credit Transitional Protection guide.

How the five-week wait affects your payments

If you're eligible and planning to claim Universal Credit, it is important to remember that you won't get any payment for the first five weeks after you make your claim.

Visit our Waiting for your first Universal Credit payment guide for more information. 

Most people find they need to get a UC advance to help them through this first period. An advance is a loan which has to be paid back over 24 months. This means that for the first two years of your Universal Credit claim you will receive less money.

Advances are generally taken back at 15% of your standard allowance:

• For a single person under 25, this is £48 per month.
• For a single person 25 or over, this is £60 per month.
• For a couple where both are under 25, this is £75 per month.
• For a couple where one or both are 25 or over, this is £94 per month.

Example

Julia is a single mum with one child aged four and rent of £180 per week.

She gets Carer's Allowance and has one non-dependant.

She can see that on her old benefits she is entitled to £1,495 per month but on Universal Credit she is entitled to £1,552 per month.

She decides to claim Universal Credit and takes a £1,000 advance for the first five weeks. This means that for the first year of her claim she is paying back her advance at £60 per month, so she only receives Universal Credit payments of £1,492 per month. This means that though she changed benefits thinking she'd be better off on Universal Credit, for the first year she is actually getting less money than she did on her old benefits.

You can read more in our Universal Credit Advance guide.

Under Universal Credit, more people are expected to look for work than in the old benefits system.

Whether you have to look for work when you're claiming Universal Credit depends on each individual's circumstances. Find out more about what you have to do to receive Universal Credit.

Self-employed people can often find they are much worse off on Universal Credit than on the old benefits system. This is because of a rule called the Minimum Income Floor.

Self-employed people are assessed differently due to a rule called the Minimum Income Floor. If you usually earn less than someone working full time on minimum wage would earn, you're likely to find that Universal Credit in the long term is less generous.

Read more in our Self-employment and benefits guide.

Where in the UK you live will impact the how often you get paid.

In England and Wales, Universal Credit is usually paid monthly. In Scotland, you can request it to be paid in two parts each month. In Northern Ireland, it is paid in two parts each month but you can ask for it to be paid once per month.

Managing your budget

If you're used to managing your budget weekly or fortnightly, or you're used to getting payments every four weeks, this might come as a bit of a change.

You might need to look again at how you manage your budget.

If you’re finding it really hard to manage your budget on one monthly UC payment, you can ask to be paid twice a month instead. This is called an Alternative Payment Arrangement (APA). You can request this by leaving a message in your UC journal or by speaking to your work coach.

Make sure you fully understand what this will mean for your budget before you decide to ask for this. Especially, think about how you will pay your rent if the money you get for your housing costs is split over two payments rather than being paid in one go.

Childcare costs

Universal Credit payments go up and down depending on how much your childcare costs that month are and how much you have earned.

Some people can get help with the upfront costs of childcare through Universal Credit. Visit our Help with Childcare Costs guide for more information.

Universal Credit is assessed and paid monthly.

This means that if your pay from work is not monthly (for example, if you are paid weekly, fortnightly, or four-weekly), some months it will look to Universal Credit like you have had extra pay

For example, someone who is paid four-weekly gets 13 payments a year. This then has to be squeezed into twelve monthly Assessment Periods. This means that one month a year, Universal Credit will think that person got paid twice.

Universal Credit will not help you with this problem. The DWP says you need to plan for and budget to account for this.

We cannot tell you which month will have extra pay taken into account - you will need to use a calendar to mark all your assessment periods against all your paydays to check which months will be affected.

Citizens Advice operates a helpline for people in England, Wales and Scotland where you can get advice on whether Universal Credit is right for you.

• England: 0800 144 8 444 (Relay UK: 18001 0800 144 8 444)
• Wales: 08000 241 220 (Relay UK: 18001 08000 241 220)
• Scotland: 0800 023 2581

In Northern Ireland, contact Advice NI on 0800 915 4604.

Use the Turn2us Find an Adviser tool to locate and advice service near you.