Benefits and tax credits when you’ve lost your job

Wondering what to do if you lose your job? Find out what benefits are available to help you cope with the loss of income and how to claim them.

What benefits can you claim if you’ve lost your job?

The main benefit you can claim while you’re out of work is Jobseeker’s Allowance, or Universal Credit if you live in an area where it has already started.

Jobseeker’s Allowance is gradually being phased out and replaced by Universal Credit. Your local Jobcentre Plus can tell you whether you should claim Jobseeker’s Allowance or Universal Credit.

Universal Credit

If you claim Universal Credit you’ll get a single monthly payment.

This will include a basic payment plus other elements.

These elements are payments for things such as housing costs, childcare or caring. You must claim Universal Credit online.

Find out more in Universal Credit explained.

Jobseeker’s Allowance

If you claim Jobseeker’s Allowance you might also be eligible for other support, such as tax credits or help with rent or mortgage costs.

Jobseeker’s Allowance is usually paid every two weeks.

Are you entitled to benefits if you’ve been sacked?

If you’ve been dismissed from your job because of misconduct, or you left it without a good reason, there may be a delay before you can start getting Jobseeker’s Allowance or Universal Credit.

This is because your Jobcentre Plus work coach is allowed to apply a sanction to your benefit – in other words, stop it being paid for a certain number of weeks. It’s up to your work coach how long the sanction lasts.

Claiming Jobseeker’s Allowance or Universal Credit

Testimonial

“The thought of going to the Jobcentre really worried me. All I could think of was that scene from The Full Monty. But the staff weren’t scary at all. They talked me through everything, and made sure I got what I was entitled to. I even got help with my rent.” – Pritish

You can start your claim for either benefit online. It should take up to 40 minutes.

You’ll need to give:

  • Your postcode;
  • Details of your education;
  • Your past employer;
  • Your National Insurance number;
  • Details of people living with you;
  • Details of any income and savings;
  • Details about your rent or mortgage;
  • Details of any other benefits you are getting;
  • Details of the bank, building society or credit union account you want your benefit paid into (you must give this if you are claiming Universal Credit).
Find out how to claim Jobseeker’s Allowance or Universal Credit on GOV.UK.

Next steps

After you’ve applied, you’ll have to follow these steps:

  1. Go to an interview at the Jobcentre or Jobs and Benefits Office. An adviser will talk you through the process and look at ways to improve your chances of finding work.
  2. Sign a ‘Claimant Commitment’. This will set out steps you must take to get a job (such as spending a set number of hours looking for a job). This will depend on things like your health, responsibilities at home and how much help you need to find work or increase your income.
  3. Go back every two weeks to confirm your benefits claim (called ‘signing on’). You’ll also need to prove that you’re meeting the conditions of your Claimant Commitment. After 13 weeks, you’ll have a review with your adviser.

Your benefit payments could be stopped for a while if you don’t agree to do something you agreed to do in your Claimant Commitment and you don’t give a good reason. This is called a sanction.

Statutory redundancy pay

If you’ve been made redundant, you’ll normally be entitled to statutory redundancy pay if you’re an employee and you’ve been working for your current employer for at least 2 years.

Tax credits

Millions of families and adults in the UK get tax credits to help make ends meet.

You could get tax credits if you have children, or if your partner is still working and your total household income is below a certain amount.

Tax credits can be paid weekly or every 4 weeks.

If you already get tax credits, you must tell the Tax Credits Helpline (0345 300 3900) about your job loss.

The amount you get could rise or fall as a result.

Find out more about Claiming tax credits..

Benefits to help with housing costs

Help with your rent

Depending on your income and savings, you could get some help with your rent from Housing Benefit or Local Housing Allowance.

Help with Council Tax

You might also be able to get help with Council Tax.

Help with mortgage interest payments

If you’re a homeowner, you might qualify for help with your mortgage interest payments.

Benefits to help with other costs

There are other specialist benefits available, so whatever your circumstances, make sure you’re getting the right entitlements.
Use the Turn2Us benefit calculator to find out what benefits you could get.

Welfare and educational grants

If you’re on a low income, there might be some support available through welfare and educational grants from charities.

You can search for grants on Turn2us.

If your circumstances change

Remember to tell Jobcentre Plus or Jobs and Benefits Office if you go back to work or if your circumstances change.

The same goes for HM Revenue & Customs – you could be fined £300 if you don’t tell the Tax Credits Office that your circumstances have changed.

You might still be entitled to some help when you go back to work and your income is low.

For example, if you were getting Jobseeker’s Allowance you might carry on getting Housing Benefit or Working Tax Credit.

If you are getting Universal Credit, your payments might gradually reduce until your income rises to the point where you’re no longer eligible to get it.

Tell the Tax Credits Officeopens in new window (0345 300 3900) that your circumstances have changed.

Did you find this guide helpful?