Universal Credit warning as your earnings can reduce payments

Rishi Sunak baffles MP with claims Universal Credit is 'generous'

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

If a claimant or their partner is employed, their Universal Credit payment will reduce by 55p for every £1 they or their partner earns. There is no limit to how many hours a person can work and their Universal Credit will not stop if they work more than 16 hours a week.

Those who are self-employed will receive their payment based on the earnings they report at the end of each monthly assessment period.

An individual who is gainfully self-employed will get their payment calculated using an assumed level of earnings, known as a minimum income floor.

This is based on what an employed person on minimum wage would earn in similar circumstances.

Those who earn above this amount will receive their Universal Credit based on their actual earnings.

Claimants are obliged to report any changes in their employment situation. Examples of this include:

  • Closing a business
  • Starting a different kind of business
  • Taking up a permanent job
  • Becoming unable to work

The Government website has a benefits calculator tool which will show how increasing a person’s hours or starting a new job will affect their payment.

Claimants can also get a work allowance, which is a certain amount they can work before their Universal Credit is reduced.

A person can claim this if they are responsible for a child or young person or they live with a disability or health condition that affects their ability to work.

The work allowance is lower if a person gets help with their housing costs, reducing from £573 to £344.

For example, a claimant with a child who gets money for housing costs in their Universal Credit payment and earns £500 during their assessment period, would have a work allowance of £344.

For each £1 of the remaining £156 they receive, 55p is taken from their Universal Credit, which means £85.80 is deducted from their payment.

If a person is paid once a month on the same date and nothing changes in their earnings, their payment should stay the same.

However, a person’s claim can be affected by how often they are paid, such as if they receive no wages or more than one set of wages during some assessment periods.

This may be the case if a person is paid weekly, every two weeks or every four weeks, or if their monthly payment date changes.

If a person’s monthly payment date changes, they can sign into their online account to check how much their next monthly payment will be.

If an individual is concerned they are being paid too much or too little Universal Credit, they can ask their work coach to move their wages into another assessment period.

If a person is paid weekly, or every two weeks or four weeks, they will be told if their earnings are too high and if they need to reapply for Universal Credit.

The DWP will inform a claimant if their payment stops altogether because their earnings are too high, and if their earnings decrease again they can reapply for the benefit.

Source: Read Full Article