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Four Universal Credit changes and how to stop missing out on DWP benefits owed to you

LancsLive logo LancsLive 28/06/2022 Levi WInchester & Rebecca Lockwood
Universal Credit is seeing four major changes very soon © Nick Ansell/PA Wire Universal Credit is seeing four major changes very soon

Four major changes are happening to the Universal Credit benefit scheme. It is important to keep up to date with them in order to not miss out on money entitled to you.

Here we will explain every change happening to the DWP scheme including changes to how some people receive their payments and extra money coming your way next month.

Overall, Universal Credit is paid to around 5.6 million across the country. It is a combined benefit scheme that is slowly replacing older schemes including Child Tax Credit, Housing Benefit, , Income-related Employment and Support Allowance (ESA), Income Support, Working Tax Credit, and Income-based Jobseeker’s Allowance (JSA).

READ MORE: DWP sets out method for millions to receive £650 cost of living payment

The move to put everyone on Universal Credit from legacy schemes began in May 2022. It had been paused to the ongoing Covid-19 pandemic, the Mirror reports.

National Insurance threshold

There are changes coming into play from July 6 relating to when Universal Credit (UC) claimants start paying National Insurance. It will rise from £9,880 to £12,570.

That means you can earn more money before you start paying tax. It comes after the rate at which you pay contributions was raised by 1.25% in April. Chancellor of the Exchequer, Rishi Sunak, said seven out of 10 people will be paying less for NI from July even with the 1.25% increase.

If you're paying less tax and therefore getting more money in your take-home pay, this could affect your Universal Credit. If you're in work, the amount of Universal Credit you get reduces as you earn more.

At the moment, the taper rate - how much your benefit is reduced by - is set at 55p for every £1 you earn. Some people are entitled to a work allowance, which means they can earn more before the taper rate comes in.

Cost of living payment of £650

Those on UC can claim a £650 cost of living payment being issued by Government to help with the ongoing energy bills crisis. The money will be split into two separate payment tranches.

Those who claim Universal Credit, income-related ESA and JSA, Income Support, and Pension Credit will receive £326 from July 14. The second £324 payment is expected to be sent to eligible households in autumn.

You will not be taxed on the payments and they wont impact your benefits or tax credits for the working year.

Post Office accounts ending

No longer will you be able to use a Post Office card account to claim your UC payments. You'll now have to set up another payment method to receive your money.

The DWP will no longer make payments into these accounts from November 30. If you already have an existing bank account, you can update DWP with your details - otherwise you can choose to open one.

For those who aren't able to open a bank account, you'll be able to use the Payment Exception Service. The Payment Exception Service allows those who don’t have a bank account to access benefit payments via the PayPoint network.

You can withdraw your cash either by using a payment card, voucher by email, or text message containing a unique reference number. Either of these methods must be presented at a PayPoint outlet, which are in shops and newsagents, in order to access your benefits.

Hours that are worked

Those on UC will have to work longer hours or meet with their work coach under new rules due to come into force. Currently anyone working nine hours or more does not need to attend regular appointments at the Job Centre.

This is set to rise to 12 hours, the government has confirmed - although no set date has been confirmed. Work and pensions minister Therese Coffey said in an interview with the Telegraph the change will come in "soon".

She said: “Once you get a job, if you’re working fewer than the equivalent of nine hours a week, we still expect you to be coming in and looking for work. We’re going to be raising that, I hope, very soon."

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