If you claim Universal Credit, the Department for Work and Pensions (DWP) may reduce or stop your payments if you have over a certain amount in savings. But how much exactly can you have saved?
Universal Credit is claimed by more than seven million people in the UK. If you have over £6,000 in money, savings and investments, your benefit will be reduced by £4.35 for every £250 you have between £6,000 and £16,000.
If the amount you have saved doesn't add up exactly to £250, but is over the threshold, another £4.35 is deducted from your Universal Credit.
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For example, if you have £6,300 in savings, the first £6,000 would not be subject to any deductions, but the other £300 would see your payments deducted by £8.70.
This would be £4.35 deduced for the first £250, then another £4.35 for the remaining £50 that makes up the £300. These figures apply if you're a single claimant, or claiming as part of a couple.
You are normally not eligible for Universal Credit if you have more than £16,000 in savings. If you claim Tax Credits and you've been asked to move to Universal Credit, you may still be able to get Universal Credit for up to a year if you have more than £16,000.
Universal Credit is made up of a standard allowance, which is the basic amount you get before any additional elements - for example, if you have children or are unable to work due to illness - or any deductions are taken into account.
If you work, there is a taper rate which reduces your maximum Universal Credit payment as your earnings increase. The taper rate is 55% which means 55p is deducted from your maximum Universal Credit payment for every £1 you earn.
Some people get a "work allowance" which is a set amount you can earn before your Universal Credit is reduced. The "work allowance" is worth £411 a month if you also receive help with housing costs, and £684 a month if you don't.
Universal Credit - how much you getHere is how much the different elements of Universal Credit are worth:
Standard allowance
- Single under 25: £316.98 a month
- Single 25 or over: £400.14 a month
- Joint claimants both under 25: £497.55 a month
- Joint claimants, one or both 25 or over: £628.10 a month
Child element
- First child born before April 6, 2017: £339 a month
- First child born on or after April 6, 2017 or second child and subsequent child: £292.81 a month
- Disabled child element lower rate: £158.76 a month
- Disabled child higher rate: £495.87 a month
Limited capability for work
- Limited capability for work: £158.76 a month
- Limited capability for work or work-related activity: £423.27 a month
Carer element
- £201.68 a month
Work allowance
- Higher work allowance (no housing amount): £684 a month
- Lower work allowance (with housing amount): £411 a month
Childcare costs element
- Maximum for one child: £1,031.88 a month
- Maximum for two or more children: £1,768.94 a month
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