Universal Credit and the benefits cap

Universal Credit is a new Department for Work and Pensions benefit for working age people who are out of work or on a low income.

Universal Credit

Universal Credit was introduced in Barnsley on 2 March 2015 to replace Jobseekers Allowance for new single claimants. It is being introduced in stages, so at the moment couples and families are not affected.

It is a single monthly payment that replaces the following working age benefits:

  • income based Job Seekers Allowance
  • income related Employment and Support Allowance
  • Income Support
  • tax credits
  • housing benefit

Universal Credit will be paid directly into your bank account each month. Any housing benefit that you're entitled to will be included in your monthly Universal Credit payment. This means that you’ll be responsible for paying your rent to your landlord.

Universal Credit does not cover help towards your council tax so you’ll still need to apply for council tax support if you need it.

Find out more information about Universal Credit here.

Household benefit cap

From July 2013 the government set a limit on the total amount of benefit that working age people can get. This is called a 'benefit cap'.

From November 2016 the benefit cap is to be reduced.

The reduced benefit cap will be:

  • £384.62 per week for couples (with or without children living with them)
  • £384.62 per week for single parents whose children live with them
  • £257.69 a week for single adults who don't have children, or whose children don't live with them.

If you are affected by the reduction in the benefit cap your Housing Benefit or Universal credit will be reduced.

We will write to you and tell you if your Housing Benefit payments are affected by the cap and from what date.

You should have already received a letter from the DWP informing you that you may be affected. The letter also advises you what you can do to help minimise the effect of the cap.

Benefits included in the cap

The benefits included when seeing if your benefit income exceeds the benefit cap are:

  • Housing Benefit
  • Child Benefit
  • Child Tax Credit
  • Jobseeker's Allowance
  • Incapacity Benefit
  • Income Support
  • Employment and Support Allowance (except when in the support group)
  • Maternity Allowance
  • Severe Disablement Allowance
  • Widowed Parent's Allowance & Bereavement Allowance
  • Universal Credit

Carer's Allowance and Guardian's Allowance are currently included in the benefit cap but recipients of these benefits will be exempt from the cap from 7 November 2016 when the cap is reduced.

Benefits that aren’t included in the cap

  • Working Tax Credit
  • Personal Independence Payment
  • Constant Attendance Allowance
  • Attendance Allowance
  • Industrial Injuries Disablement Benefit
  • Employment and Support Allowance with a support component
  • Armed Forces Independence Payment
  • Limited Capability for Work Related Activity element of Universal Credit
  • War widows and widowers will also be exempt

You can use the benefit cap calculator to check how this will apply to you.

More information

Visit the Gov.UK website to find out more about welfare reform and Universal Credit

Turn2us is a national charity that helps people in financial hardship gain access to welfare benefits, charitable grants and support services.