What is Universal Credit?
Universal Credit is the main means-tested benefit for working-age people in the UK. It was introduced to simplify the benefits system by replacing six older benefits: Income Support, income-based Jobseeker's Allowance, income-related Employment and Support Allowance, Housing Benefit (for most working-age claimants), Child Tax Credit, and Working Tax Credit. It is paid as a single monthly payment directly into your bank account. This single payment is designed to cover all your living costs — including housing — making it similar to managing a monthly wage. The amount you receive is recalculated each month based on your actual circumstances and earnings during that "assessment period". Over 6 million people in the UK currently receive Universal Credit, making it the most widely claimed working-age benefit. It covers a broad range of circumstances — from people who are unemployed to low-income workers, families with children, people with health conditions, and carers.
Who may be eligible?
You may be eligible for Universal Credit if you are aged 18 to State Pension age (though people aged 16–17 may qualify in certain circumstances, such as having a health condition, being a carer, or being responsible for a child). You need to be on low or no income and have savings under £16,000. You can claim whether you are in or out of work. There is no minimum hours requirement. If you have a partner, you claim as a couple — both your incomes and savings are assessed together. Savings under £6,000 are ignored entirely. Savings between £6,000 and £16,000 reduce your payment slightly (by £4.35 per month for every £250 above £6,000). Savings over £16,000 mean you are unlikely to be eligible. Certain groups face additional rules. Full-time students generally cannot claim unless they have children, a disability, or are in specific vulnerable groups. People with no recourse to public funds (certain immigration statuses) cannot claim. If you are self-employed, a "minimum income floor" may apply after an initial start-up period.
How much could you receive?
Everyone on Universal Credit receives a standard allowance as the foundation of their payment. For single people, this is up to £311.68/month (under 25) or £393.45/month (25 or over). For couples, it is up to £489.23/month (both under 25) or £617.60/month (one or both 25 or over). On top of this, additional elements may be added based on your circumstances. The housing element covers your rent (up to the Local Housing Allowance rate for your area). The child element adds up to £315/month for each child (higher for your first child). The disabled child addition is up to £456.89/month per disabled child. The limited capability for work and work-related activity (LCWRA) element adds up to £416.19/month if a health condition significantly affects your ability to work. The carer element adds up to £198.31/month if you care for someone with a disability at least 35 hours per week. Childcare costs can be claimed at up to 85% of eligible costs, up to £1,014.63/month for one child or £1,739.37/month for two or more children. The total Universal Credit payment reduces as your earnings increase, through the "taper rate".
How Universal Credit works with employment
Universal Credit is designed to make taking on work (or more work) always financially worthwhile. The key mechanism is the "work allowance" and "taper rate". If you have children or a health condition, you receive a work allowance — an amount you can earn before any deduction starts (£404/month if you receive help with housing costs, or £673/month if you do not). Above your work allowance, your Universal Credit reduces by 55p for every £1 you earn. This means you always keep 45p of every extra £1 earned — there is no "cliff edge" where benefits suddenly stop. For example, if you earn £200 above your work allowance in a month, your Universal Credit reduces by £110, but you are still £90 better off overall. This taper rate replaced the old system where multiple benefits could be withdrawn simultaneously, sometimes meaning people lost more in benefits than they gained from working. Universal Credit coordinates all elements in a single taper, making the financial benefit of work more transparent and predictable.
The application process
Apply online at GOV.UK and create a Universal Credit account. You will need an email address, phone number, bank account details, National Insurance number, details of your housing costs, and information about your income and savings. After applying online, you need to verify your identity — this can be done online through the GOV.UK Verify service or in person at your local Jobcentre. You will then attend an initial appointment where you agree a "Claimant Commitment" with your work coach. This commitment sets out what you are expected to do in return for receiving Universal Credit — such as looking for work, attending appointments, or attending training. Your first payment is usually made around 5 weeks after your claim date (a one-month assessment period plus up to 7 days for payment processing). If you need money sooner, you can request an Advance Payment — this is a loan of up to one month's expected Universal Credit, repaid from future payments over up to 24 months.
Additional benefits Universal Credit can unlock
Receiving Universal Credit can act as a gateway to several additional forms of support. Free School Meals are available for children of families on Universal Credit with earned income under £7,400 per year. Healthy Start vouchers provide a prepaid card for milk, fruit, and vegetables for pregnant women and families with children under 4 (if earned income is under £408/month). Council Tax Reduction is available through your local council and can significantly reduce or eliminate your Council Tax bill. Help with NHS costs — including free prescriptions, dental treatment, sight tests, and travel to hospital — may be available depending on your income. Sure Start Maternity Grant (a one-off £500 payment) may be available if you are expecting your first child. If you have childcare costs, Universal Credit can cover up to 85% of eligible childcare costs. If you are starting or growing a business, the New Enterprise Allowance may provide mentoring and financial support. If you are at risk of losing your home, your work coach can refer you to specialist housing support. The full range of additional support depends on your individual circumstances.
Related Benefit Pages
Universal Credit
Main means-tested benefit for working-age people on low income.
Housing Benefit
Help with rent for people on low income.
Council Tax Reduction
Reduction on Council Tax for people on low income or receiving certain benefits.
Free School Meals
Free meals during term time for children of families on low income.
Frequently Asked Questions
How long does it take to get the first Universal Credit payment?
Can I claim Universal Credit if I am self-employed?
What is the "two-child limit" on Universal Credit?
Can I claim Universal Credit if I have a mortgage?
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