Universal Credit explained

Universal Credit is a new type of benefit designed to support people who are on a low income or out of work. It will replace six existing benefits and is currently being rolled out across the UK. The new system is based on a single monthly payment, transferred directly into a bank account. At present Universal Credit only affects newly unemployed people in certain areas of the country.

What is Universal Credit?

Universal Credit is a single monthly payment for people in or out of work, which merges together some of the benefits and tax credits that you might be getting now.

Universal Credit will replace:

  • Income-based Jobseeker’s Allowance
  • Income-related Employment and Support Allowance
  • Income Support
  • Child Tax Credit
  • Working Tax Credit
  • Housing Benefit

What you need to know about Universal Credit

Universal Credit payments

Did you know?

You may have to wait several weeks before your first payment.

Universal Credit is paid in the following ways:

  • It will be paid monthly into a bank account of your choice.
  • If you get help with your rent, this will be included in your monthly payment – you’ll then pay your landlord directly.
  • If you live with your partner and you are both eligible, you will get one monthly joint payment.
  • It can take several weeks after you make your claim to get your first payment.

Universal Credit and waiting days

If you make a new claim for Universal Credit you will not be paid for the first seven days. These days are known as waiting days. However, you should not let this delay your claim and apply as soon as you are eligible to do so.

The seven days’ waiting period won’t apply if you are in certain circumstances, for example if you’re terminally ill or vulnerable, have previously claimed Universal Credit, are splitting up from or moving in with a Universal Credit claimant, or are moving on to it from another benefit.

If you are worried about how you will manage for money until you get paid, read our guide Support while waiting for benefit payments.

Working and claiming Universal Credit

There are no limits on how many hours a week you can work if you’re claiming Universal Credit. Instead, the amount you get will gradually reduce as you earn more, so you won’t lose all your benefits at once.

  • Get an estimate of how much Universal Credit you’ll be entitled to using the calculator on the Policy in Practice website.
  • Or use a benefits calculator on the GOV.UK website to estimate all your entitlements including Universal Credit.
  • What happens to your Universal Credit when you start work or work more hours? Watch the video below from the Department for Work and Pensions (DWP) to find out.

What else is new about Universal Credit?

When does Universal Credit start and who does it affect?

Universal Credit is being introduced in stages. Most people won’t be affected to start with. At the moment, Universal Credit mainly affects newly unemployed people in specific areas of the country.

If you’re already claiming one or more of the benefits being phased out, you should carry on claiming as normal. You’ll be told when you need to do anything differently.

However, if your circumstances change, you may be asked to claim Universal Credit instead.

If you’re newly unemployed

If you’ve recently become unemployed you might be asked to claim Universal Credit rather than Jobseeker’s Allowance.

In England, Scotland and Wales, Universal Credit is now available to single jobseekers in all Jobcentres. In some areas it is also available to couples and families too.

In Northern Ireland, Universal Credit is expected to be introduced during 2017.

Claiming Universal Credit

How to claim Universal Credit

Did you know?

If you need help getting online your Jobcentre or local council can provide support. Find out where to get support on UK Online.

If you are eligible for Universal Credit, you are expected to make your claim online on the Apply for Universal Credit website.

You can find a list of the information you’ll need to provide on Making a Universal Credit claim.

If you and your partner are making a joint claim, only one of you will need to complete the online claim form, but that person will need to enter details for both of you.

For more details, visit the GOV.UK Your claim journey website.

Contact the Universal Credit Helpline

Ask For A Callback

Make sure you ask the person on the Helpline to call you back so that you don’t have to pay for the call.

If you need help with your claim, you can contact the Universal Credit Helpline on Tel 0345 600 0723 or text phone 0345 600 0743 between 8am - 6pm, Monday to Friday (closed on bank and public holidays).

Calls are free if you have free or inclusive minutes as part of your phone contract. Otherwise ask them to call you back, as the call may cost you up to 40p per minute if you’re calling from a mobile. It’s particularly important to do this if you’re making your claim by phone, as this can take up to 40 minutes.