Thousands to get £1,000 Universal Credit boost from today under taper rate cut

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The DWP estimates around two million people who already claim Universal Credit will benefit from the changes while a further 500,000 families will become eligible for support

Latino man is sitting at a desk with daughter in his lap and signing papers.
Are your payments rising?

A promised cut to the Universal Credit taper rate comes into effect on December 1, with thousands of households to see their payments rise slightly from Wednesday.

The first change is to the taper rate, which is how much your Universal Credit gets reduced by for every pound you earn through work.

This has been lowered from 63p to 55p – meaning workers claiming support will keep more of their pay.

The second change is to the work allowance, which is the amount some claimants can earn before the taper kicks in.

This has been raised by £500 per year and usually applies to those with children or limited capacity to work.

Households who will see their incomes change as a result of the changes were told their payments would rise in their monthly payment statement last week. These changes are due to kick in from December 1.

Last month, the taper rate was cut from 63% to 55%
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Image:

Tayfun Salci/ZUMA Press Wire/REX/Shutterstock)

However, your exact payment date will depend on your Universal Credit assessment period.

It is estimated that around two million claimants will get a boost by Christmas.

Under it, work allowances will be boosted by £500 and the taper rate cut by 8% following changes announced by the Chancellor after the £20 a week Universal Credit Covid boost was terminated.

Vulnerable households can also get access to a new £500million support fund to help them with essentials over the coming months.

Single parents paying the higher rate of tax will also be entitled to Universal Credit for the first time from this month.

Chancellor Rishi Sunak said: “We want this to be a country that rewards hard work by helping the lowest income families keep more of their hard-earned cash.

“That’s why at Budget, I announced an effective tax cut for 2 million people worth over £2 billion.

“These changes come into force today and will mean that with Christmas approaching, hard-working families keeping an extra £1,000 a year of what they earn.”

How to check if your Universal Credit has gone up

Both changes will affect “assessment periods” ending on or after today, and the first claimants to get higher payments will be from December 1.

To work out how much you will be paid on the new rates, enter your details into the benefit calculator below.

When using the Turn2Us calculator, you’ll need to answer questions about your living arrangements and any income you’re receiving.

You’ll need to answer as accurately as possible in order to get a correct figure.

Whether you’ll receive any extra pay at all also depends on your circumstances.

Calculations by the Joseph Rowntree Foundation show that a single parent with a five-year-old child who works 16 hours a week will be £8 a week better off under the changes.

Or for a family of four with young kids where one parent works full-time and the other works 16 hours a week, they’ll have £31 a week more in their pocket.

How is Universal Credit calculated?

Universal Credit is made up of a standard allowance and any extra amounts that apply to you.

For example, if you have children, a disability or a health condition.

Your Universal Credit is then subject to deductions based on your savings and, if you are working, how much you earn.

DWP bosses look at your circumstances each month – known as your assessment period – to see how much you’re entitled to.

Your monthly standard allowance depends on your circumstances:

  • Single and under 25 £257.33
  • Single and 25 or over £324.84
  • In a couple and you’re both under 25 £403.93 (for you both)
  • In a couple and either of you are 25 or over £509.91 (for you both)

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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