Benefit payment advances and Budgeting Loans

If you’re waiting for your first benefit payment and have little or no money, you might be able to apply for a short-term benefit advance or a Universal Credit Advance payment. This page explains more about advance payments as well as Budgeting Loans and other help when you’re already claiming benefits.

How to apply for Universal Credit Advance payments

Top Tip

You will have to repay the advance from your future Universal Credit payments, so only ask for what you need.

It can take up to five weeks to get your first Universal Credit payment because Universal Credit is paid monthly in arrears.

If you will have little or no money until your first payment, you can request an advance payment from your work coach or by calling the free Universal Credit helpline.

You can request up to a full month’s payment as an advance and you will have to repay this from your future Universal Credit payments for up to 12 months.

You can claim up to a full month’s expected payment but as you will have to pay this back you should only claim as much as you need to get you through to the first full payment.

If you only claim a part payment but find you need more money, you can make a further claim for the remainder of your first full payment.

Once the first assessment period is over, you can’t claim another advance payment.

To request an advance, you will need to talk to your work coach, or call the Universal Credit helpline. This can be done when:

  • you make your claim for Universal Credit
  • while you’re waiting for your first payment
  • when you’re reporting a change in circumstances.

You will be asked to explain why you need the advance, provide your bank details and have your identity checked.

You should get a decision the same day and any advance agreed should be paid into your bank in five working days.

Repaying the advance

If the advance is agreed, your work coach or helpline adviser will explain how much you will get, how much you will have to repay each money and when the first payment is due.

Repayments can be made over a maximum of 12 months and can be up to 40% of your Universal Credit basic allowance.

This means it’s very important you think about how you will pay it back and how repaying out of future Universal Credit payments will affect you.

In particular, you need to remember the repayments come out of your basic allowance, which is supposed to be for your day-to-day spending. The other elements you might receive are to cover specific costs such as housing or children.

It’s also important to remember, if you’re moving from Housing Benefit to Universal Credit, you will continue to get Housing Benefit for two weeks.

Find out how much the Universal Credit basic allowance is and learn more about the other elements here.

Why would you be refused an advance?

An advance might be refused if you (or both of you if you’re claiming as a couple):

  • have enough money to last until your next payment
  • live with parents, relatives or friends
  • have any final earnings, redundancy payments or accessible savings.

You can ask for a decision to be reconsidered, but you don’t have a right to appeal.

Universal Credit scams

Benefit claimants are being targeted by scammers offering low-cost loans or grants from the government.

You might be called by someone claiming to work for Jobcentre Plus, or contacted through social media ads. Many of the scammers have convincing websites, with government logos and testimonials.

They may ask for your ID and bank details, offer to make a claim for Universal Credit and apply for an advance payment on your behalf, taking some of this money as their fee.

However the full amount of advance payments need to be repaid out of future Universal Credit payments, so you will end up paying back the whole amount borrowed.

You should also not be tempted by these offers if you are already claiming any of the benefits (like tax credits or Housing Benefit) that are being replaced by Universal Credit. This is because your old benefits will stop and the money you get on Universal Credit might be less than you are getting now.

If you are simply offered a government loan and asked to give your ID and bank details, the scammer might be trying to make a Universal Credit application without your knowledge, so do not give out these details as you may not be entitled to Universal Credit and this could be seen as benefit fraud.

If you are waiting for your first Universal Credit payment and do need help applying for an advance payment the Citizens Advice Help to Claim Service will help you get the payment you need for free.

If you have been targeted, even if you’ve not become a victim, you can report it to Action Fraud on 0300 123 2040, by using their online reporting tool, or to the FCA Scam Smart website.

Read out blog post on Universal Credit scams.

Universal Credit helpline

If you need help with your claim, call the Universal Credit helpline free on:

Telephone: 0800 328 5644
Textphone: 0800 328 1344

8am - 6pm, Monday to Friday (closed on bank and public holidays). Calls are free.

How to apply for a short-term benefit advance

You can ask for a short-term benefit advance if you’re in financial need and either:

  • you’ve made a new claim for a benefit and you’re waiting for your first payment
  • you’ve had a significant change in your circumstances meaning your benefit will go up by a large amount and you can’t wait until the next payment.

If you are awarded an advance payment of your benefit you will normally pay it back out of your future payments.

You can make a claim in person at your local Jobcentre Plus office. Or you can call the helpline dealing with the benefit you’re claiming.

You can now only apply for a Universal Credit advance online if you have made a claim within the past five weeks, are waiting for your first payment and have already had an interview at your Jobcentre.

If you have been waiting for longer than five weeks for your first payment, you will need to apply by calling the Universal Credit helpline on 0800 144 8444 in England or 0800 024 1220 in Wales.

If you apply for an advance by speaking to your work coach or calling the Universal Credit helpline, you (and your partner if you are claiming jointly) will need to:

  • explain why you need an advance
  • provide bank account details where the advance should be paid
  • have had your identity checked at a Jobcentre.

How to apply for help with the rent

If you’ve claimed Housing Benefit or Council Tax Reduction and need help with paying your rent or Council Tax until you get your first payments, you might be able to apply for a short-term Discretionary Housing Payment from your council.

How to apply for a Budgeting Loan

If you’ve been getting certain benefits for at least 26 weeks you might be able to apply for an interest-free Budgeting Loan to cover essential expenses such as clothing, footwear or furniture for your home.

Relevant benefits include:

  • Income-related Employment and Support Allowance
  • Income-based Jobseeker’s Allowance
  • Income Support.

Ask your adviser at the Jobcentre Plus for an application form.

Find out more in our guide to Budgeting Loans.

How to apply for a Budgeting Advance if you’re on Universal Credit

If you’ve been claiming Universal Credit for six months or more you might be able to claim a Budgeting Advance to cover essential expenses.

You can’t claim a Budgeting Advance if you’re waiting for your first Universal Credit payment - you’ll have to claim a Universal Credit Advance instead.

You have to pay the money back from future Universal Credit payments but the loan is interest free.

Ask your work coach at the Jobcentre Plus how to apply.

Other sources of help

How to find your local welfare scheme

If you need help with heating, fuel or food bills or have an emergency expense, you can see if your local welfare scheme can help.

In England this scheme is run by your local council.

The other countries in the United Kingdom run their own schemes.

If you live in Wales, find out more about the Discretionary Assistance Fund on the Welsh Government website.
If you live in Northern Ireland, find out more about Discretionary Support on the nidirect websiteopens in new window.

How to apply for a credit union loan

If you have to borrow money, see if there’s a credit union in your area. They specialise in offering loans at low rates and helping members who need financial help.

Some credit unions might lend money straightaway to new members without you having to save with them first.

You will have to pay a higher interest charge than the rates offered to regular savers, but this rate is usually much lower than other high-cost credit, such as payday loans or doorstep loans.

The credit union will want to be sure you can afford to pay the loan back but they will work with you to make your repayments manageable.

Find out more in our guide Borrowing from a credit union.

Get help with budgeting

If you need help with personal budgeting, ask at the Jobcentre and they will be able to tell you where face-to-face support is available.

Alternatively, read our page on How to budget for a monthly benefit payment.

Get free debt advice

If you’re struggling to pay off existing debts, seek advice from a debt advice charity straight away.

Did you find this guide helpful?