ALL CHANGE Four Universal Credit and benefit payment changes coming next month – are you affected?
FOUR major changes to Universal Credit and benefits are due next month.
It's crucial to understand how they might impact you and your household.
A looming tax credit deadline demands immediate attention.
Thousands more will need to take action and switch to Universal Credit.
In addition, benefit recipients can expect early payments next month due to the August bank holiday.
Here are all the big benefit changes coming in August.
1. TAX CREDIT DEADLINE
Around 730,000 households have been sent reminders about the benefit and many will need to let HMRC know of any changes that affect payments.
Working tax credits are worth £2,435 for the basic element and child tax credits are worth £3,455 to help those on low incomes.
There are also extra amounts, for example for those who are single parents or have disabilities.
Tax credits need to be renewed each year, and claimants should have received renewal packs in the post by June 20.These need to be responded to by July 31 with information about your circumstances if there's a red line and it says "reply nowThis includes your income, and your partner's if you have one, for the last tax year which runs from April 6, 2023 to April 5, 2024.
Plus any changes to things like working hours, how much you pay for childcare, or if a child leaves home or is over 16 and leaves education or training.
If you don't tell HMRC about changes you could be fined £300.
If you give them the wrong information you could be hit with an even bigger fine in the worst case.
2. MOVE TO UNIVERSAL CREDIT
Hundreds of thousands on benefits need to take action by the end of this month or risk having their payments stopped.
The Government is moving two million people on old-style legacy benefits to Universal Credit through "managed migration".
Letters are being sent to those eligible telling them to make the move across.
But you only have three months from the date the letter was sent to move to Universal Credit.
Fail to do this and you will have your benefit entitlement stopped.
Even if you decide to claim after the deadline, you can still lose out on transitional protection as you only get this if you claim by the deadline date.
Around 120,000 households claiming tax credits with housing benefit started receiving their managed migration letters in April.
Meanwhile, 110,000 income support claimants also started receiving their letters.
If this is you, you have until the end of July to put in your claim for Universal Credit or risk being without benefits.
It comes after anti-poverty charity Z2K warned over 31,000 households receiving tax credits had their benefits stopped after failing to act upon migration notices received between November 2022 and September 2023.
It said it meant a typical household losing out on roughly £4,130 a year.
Managed migration notices were sent to those on housing benefit alone in June, meaning they have until the end of September to move.
Anyone getting Employment and Support Allowance (ESA) along with child tax credits will start being asked to switch from July.
Those claiming tax credits and over state pension age will be asked to apply for either Universal Credit or Pension Credit from next month.
What is managed migration?
ADVICE from Ayla Ozmen, director of policy and campaigns, at anti-poverty charity Z2K.
The DWP is stopping so-called "legacy benefits" for working-age people.
That means you won't be able to claim benefits like income-related employment and support allowance, income support, tax credits, or housing benefit (unless you're in temporary accommodation or supported housing).
Instead, you'll need to claim Universal Credit.
The DWP is sending everyone currently getting these benefits a letter called a "migration notice", giving you three months to claim Universal Credit.
If you don't claim and don't ask DWP for more time, your legacy benefits could be stopped – even if you're not getting Universal Credit either.
That means you might not have anything to live on, and you'll be at risk of building up debt on important bills like rent.
If you leave it too late to claim Universal Credit, you won't be "repaid" for the gap either.
And you could also miss out on something called the transitional element.
Some people, including many disabled people, get less money under Universal Credit than under legacy benefits.
The transitional element means that you don't face a sudden drop when you move to Universal Credit under managed migration, but instead it reduces over time.
But if you ignore your migration notice and later claim Universal Credit, it's treated as a brand new claim – so you get no transitional element.
3. BENEFITS PAID EARLY
Thousands can expect to see their benefit payments land earlier than usual next month.
This is because when the day payments are due falls on a bank holiday or the weekend, payments are made on the first working day before.
t means those expecting benefit payments on the August bank holiday, August 26, will actually see payments land in their accounts on August 23.
Anyone expecting them on August 24 or 25 will also receive their money on August 23.
The Department for Work and Pensions (DWP) and HMRC have confirmed the following benefits will be made early in August:
- Attendance allowance
- Carer's allowance
- Disability living allowance
- Income support
- Jobseeker's allowance
- Pension credit
- Personal independence payment (PIP)
- State pension
- Universal Credit
- Child benefit (paid by HMRC)
- Tax credits (paid by HMRC)
If you are expecting your benefit payment on August 23 and don't receive it, contact DWP.
You can also submit a complaint to the Government department to get a problem sorted if your payment is wrong.
4. CHILD BENEFIT DEADLINE
Parents have just weeks to take action or they could risk losing up to £1,331 in child benefit payments.
The taxman is posting thousands of letters to parents of teenagers asking them to give an update about their future education plans.
Child benefit is worth up to £1,331 a year for the first or only child, and up to £881 a year for each additional child.
Payments will automatically stop on August 31 on or after the child has turned 16 unless parents renew their claim when their child is continuing in education.
The parents of children who are furthering their education have until August 31 to tell HMRC or their payments will automatically stop.
Parents can continue to receive the cash boost up until their child is 19, and enrolled in an apprenticeship program or the following education schemes:
- A levels or Scottish Highers
- International Baccalaureate
- home education - if it started before their child turned 16, or after 16 if they have a statement of special educational needs and it was assessed by the local authority
- T levels
- NVQs, up to level 3.
Child benefit will also continue for children studying on one of these unpaid approved training courses:
- in Wales: Foundation Apprenticeships, Traineeships or the Jobs Growth Wales+ scheme
- in Northern Ireland: PEACEPLUS Youth Programme 3.2, Training for Success or Skills for Life and Work
- in Scotland: Employability Fund programme and No One Left Behind
It works out at £25.60 per week for your first child and £16.95 for every child after that, so it is important to respond to the HMRC if you want to receive the benefit in September.
How to claim Child Benefit
CHILD benefit is worth up to £1,331 a year for your first or only child and up to £881 a year for additional children.
This works out at £102.40 every four weeks or £25.60 a week for your first child and £67.80 every 4 weeks or £16.95 a week for their siblings.
There is no limit on the number of children that can be claimed for.
Applying is straightforward and can be done in minutes at gov.uk or through the HMRC app.
Parents with a newborn baby should make a claim online as soon as possible and could then receive their first payment in as little as three days.
You can also backdate claims for up to three months.
Parents can make a claim and then choose to opt out of receiving Child Benefit payments can still receive National Insurance credits if one parent is not working.
National Insurance credits build up your entitlement to the state pension.
What else is happening with benefits?
A consultation on a huge shake-up to PIP came to a close earlier this week.
The plans, which have been consulted on since April, include proposals to "move away from a fixed cash benefit system".
This could mean that people with some conditions will no longer receive regular payments but instead will get improved access to treatment if their condition does not involve extra costs.
Some households may even receive one-off grants or vouchers for home adaptations or improvements or expensive equipment.
Plus, those with long-term serious conditions may not be reassessed for PIP.
PROPOSED CHANGES TO PIP
THE three key changes included in the Green Paper are:
- Changing PIP eligibility criteria to better reflect how conditions affect a claimant's daily life
- Making PIP assessments more closely linked to someone's conditions, including removing assessments entirely for some conditions supported by medical evidence
- Moving away from a fixed cash benefit for some conditions, providing either one-off grants for specific costs such as home adaptation, or ensuring access to “alternative means of support”.
The outcome of the consultation has not yet been released.
However, it remains unclear if the new Labour government is expected to drop the plans previously initiated by the previous government.A DWP spokesperson said: "We are committed to championing the rights of disabled people so their views and voices are at the heart of all we do.
"We will now consider the responses to the consultation."
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