What is Universal Credit?
Universal Credit is a benefit that combines means tested support for adults of working age and children, into one benefit. It is paid monthly in arrears and any entitlement including housing costs is usually paid directly to the household making the claim. It replaces six means tested legacy benefits:
- Child tax credit (CTC) – for families who have children or qualifying young person(s) subject to earnings maximum
- Employment and support allowance income related (irESA) - income replacement which is for people with limited capability for work
- Housing benefit (HB) – for people on low income or who have no income, who pay rent
- Income support (IS) – income replacement mostly available to lone parent with a child under 5, carers receiving carers allowance and some sick/disabled people,
- Jobseekers allowance income based (ibJSA) – not in full time work, actively seeking work, available for work, not found to have limited capability for work
- Working tax credit (WTC)– for low paid workers, tops up wages to certain amount
When can you claim Universal Credit?
If a household needs to make a new benefit claim for help with rent, has no income, is on a low income, has limited capability for work, has dependent children or qualifying young people in their home or is a carer, they will need to claim universal credit.
A household is defined as a person, their partner and any dependent children or qualifying young persons (16 to 19 years old).
If there is a change of circumstances in the household, it may lead to a natural migration to a universal credit claim.
This can be where:
- they were not in receipt of any tax credits and have had your first child
- they move to a different local authority and need help with their rent
- they fail their work capability assessment for ESA and decide to claim another benefit while waiting for a mandatory reconsideration (unless they satisfy the severe disability premium rule – see below)
- from 15 May 2019 they are a mixed age couple and there has been a change of circumstances. A mixed age couple is where one member of the couple is still of working age and the other is over qualifying pension age.
Who can continue to get one or more legacy benefit?
A household can remain on legacy benefits even if they have a change of circumstances and would not need to naturally migrate to universal credit if :
- a person and/or their current partner is entitled to IS, ibJSA, irESA or HB which includes a severe disability premium (SDP) or were entitled to IS, ibJSA, irESA or HB within the last month, their award included a SDP and they have continued to satisfy the conditions for the premium during the past month.
- a household needs to claim working tax credits and are already receiving child tax credit or vice versa. In this case, they can remain on tax credits but can claim universal credit instead, if they wish. In some circumstances, they may be better off on universal credit.
- both members of a couple are both of qualifying pension age
- the household lives in specified or temporary accommodation. They can claim housing benefit for their rent but must claim universal credit for themselves and their dependent children or qualifying young person(s) if not already in receipt of benefits.
Will I get help with my rent or service charges if I get Universal Credit?
You should ask for help with your rent or service charges when you are making your new universal credit claim even if you do not have your tenancy agreement to hand or are not sure of the exact amount of your rent.
Your housing costs will normally be paid directly to you as part of your monthly Universal Credit payment and you must then pay your full property rent or service charges to your landlord.
Universal credit will only pay eligible housing costs so your maximum universal credit may be different to your actual housing costs.
You may therefore have a shortfall between the amount Universal credit pays you and the amount of your full property rent or service charges.
You will be expected to pay your full property rent in all circumstances regardless to the source of your income.
A standing order is the best way to pay your rent when you are on universal credit because it can be set up for the rent to come directly out of your bank account on any date you choose.
The standing order can be set for the day after your universal credit payment date. If you pay your rent to the London Borough of Havering, you can fill out our standing order form and take it to your bank.
Alternatively, you can set up the standing order on your internet or telephone banking using our bank account details from the form. Your payment reference number is your 14 digit rent reference number.
How do I claim Universal Credit?
You can get help to claim from Citizens Advice.
Universal Credit Advance
You can ask for an advance when you claim universal credit.
If you take an advance and it includes money for your rent you must pay the money for your rent directly to your landlord immediately upon receiving the advance.
If you pay your rent to the London Borough of Havering, you can pay us the housing costs part of the advance online or on our debit card telephone line on 01708 433993.
You will need your 14 digit rent reference number to make the payment.
Please be aware that universal credit will deduct the repayment for the advance from your monthly award, starting with your first payment.
They will spread the repayment of the advance over a 12 month period which means your universal credit monthly payment will be reduced for those 12 months. The amount they take back from your payment can be a lot of money per month depending on how much you took for the advance.
For example, if you are a couple over 25 with two children who were born before 6 April 2017 and your rent is £600 per month, your advance could be £1607.64. This means that the amount that universal credit will deduct from your payment every month for the 12 months is £133.97.
You must still pay your full rent as a priority and the fact that universal credit is deducting the advance will not be a valid reason for not paying your full property rent.
Can I get help with my Council tax?
Council tax support is not part of universal credit and must be claimed from your Local Authority separately.
If you live in Havering and have applied for or are in receipt of universal credit, are on a low income, on other benefits or have no income and are liable for Council tax you can claim Council Tax support.
Budgeting, debt and money management
Legacy benefits are traditionally paid weekly, fortnightly or four weekly however universal credit is paid calendar monthly.
This may require a household to change the way they budget, manage their money and pay their debts.
Is there any working age income replacement benefit still available which is not means tested?
You or your partner may be able to claim new style ESA or new style JSA with or instead of universal credit, if you are of working age.
These are assessed based on whether you have previously worked and paid enough National Insurance contributions over a specified period of time in addition to other criteria. You can get the benefit on its own or at the same time as universal credit.
The benefits will be taken into account as income when assessing your universal credit award.
- new style ESA - which you may be able to get if you are ill or have a health condition or disability that limits your ability to work.
- new style JSA - which you can claim if you are actively seeking work. If you are awarded new style JSA, it will be paid for 182 days after which you will need to talk to your work coach for your options.
Is there any extra support for people on Universal Credit?
People in receipt of Universal Credit may be able to get some extra support.
It will depend on their personal circumstances whether or not they can get this support.
Further advice and support for Havering residents
Citizens Advice Havering run weekly drop-in sessions providing independent, confidential information on a range of issues including debt and benefits.
General support and advice
Understanding Universal Credit: You can find out more about understanding how Universal Credit works in general and on how Universal Credit can open up work.
GOV.UK: The best place to find government services and information, including benefits, Universal Credit, Tax Credits, Pension credits, Community Legal Advice (CLA) and working, jobs and pensions is the GOV.UK website
Money Advice Service: Set up by the government to provide free, impartial advice about how to budget, deal with debt and manage your money. You can phone 03005005000 or visit the Money Advice website.
Turn2us: Provides free services that can help people in financial need to access welfare benefits, charitable grants and other financial help. Visit the Turn2Us website.
National Debtline: A charity providing free, confidential, debt advice service. Phone 0808 808 4000 or visit the National Debtline website.
StepChange: One of UK’s leading debt advice agencies. Phone 0800 138 1111 or visit the StepChange website.
Christians Against Poverty: Their mission is "freeing people from the miserable grip of UK poverty". Visit Havering Grange Centre, Havering Road Romford RM1 4HR or visit the Christians Against Poverty website.
Stop Loan Sharks provides information and advice on loan sharks, visit the Stop Loan Sharks website or call 0300 555 2222.
Entitledto: a leading provider of online benefit calculators. They help people determine what they can claim from national and local government via their anonymous self-serve calculators. Visit the Entitledto website.