Millions of individuals receiving Universal Credit will experience a delay in receiving boosted payments, despite the scheduled increase in rates starting in April.
The standard allowance for Universal Credit, representing the entitled amount before any deductions, will see an inflation-adjusted rise effective April 13. For single claimants over 25 years old, the monthly standard allowance will increase from £400.14 to £424.90. However, due to the arrears payment structure of Universal Credit, the actual pay rise will not be noticeable until June.
The augmented rates will only impact Universal Credit assessment periods commencing on or after April 13. As Universal Credit payments are disbursed a week after each assessment period’s end date, the new rates will not take effect until June payments.
The assessment period determines the Universal Credit amount based on earnings and deductions within that timeframe. Nearly eight million people in the UK are beneficiaries of Universal Credit.
Eligibility for Universal Credit hinges on personal circumstances such as age, living arrangements, relationship status, income, savings, and sometimes health conditions.
For employed individuals, a taper rate reduces the maximum Universal Credit payment as earnings increase, with a 55% deduction rate applied for every £1 earned.
Some recipients qualify for a “work allowance,” allowing a set earning threshold before Universal Credit reduction kicks in. The work allowance amounts to £411 per month for those receiving housing assistance and £684 per month for those without.
Detailed information on additional elements, reductions, and deductions for Universal Credit payments can be accessed on GOV.UK.