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Daily Record
Daily Record
Lifestyle
Linda Howard

New cost of living payment update for people claiming means-tested benefits including Universal Credit

The Department for Work and Pensions (DWP) has shared details on how the qualifying period for the £301 cost of living payment was selected so that it was “as close to the payment date as possible” to ensure only those who had recently received a means-tested benefit award would receive the money.

Labour MP Justin Madders, asked DWP why the qualifying assessment period for the first part of the £900 cost of living support, was selected as between January 26 to February 25, 2023. In a written response on June 19, Minister for Social Mobility, Youth and Progression, Mims Davies MP explained: “Claimants who received a nil award during the qualifying period would not be entitled to a cost of living payment. Most nil awards will be as a result of increased earnings.

“Paying those with financial resources available, which would make them ineligible for means-tested benefits, is not the intention of the cost of living payments which are aimed at those on the lowest incomes.”

The DWP has also previously said that the three instalments that make up the £900 cost of living support - £301, £300 and £299) - are being made in this way to ensure people on a low income receive the additional support when they need it most.

Someone who may have received a nil award for the £301 assessment period, may qualify for the next lump sum for £300 in the autumn, or the £299 due next spring.

Below are the details about the remaining means-tested cost of living payments, worth a total of £599.

Qualifying benefits for £300 payment

The £300 cost of living payment will be made to eligible households receiving the following benefits this autumn:

  • Universal Credit
  • Income-based Jobseekers Allowance
  • Income-related Employment and Support Allowance
  • Income Support
  • Pension Credit
  • Working Tax Credit - paid by HMRC if no other DWP means-tested benefit is also claimed
  • Child Tax Credit - paid by HMRC if no other DWP means-tested benefit is also claimed

This payment will be tax-free, will not count towards the benefit cap, and will not have any impact on existing benefit awards.

Benefits that do not qualify for £300 payment

You will not get a payment if you are only getting:

  • New Style ESA
  • Contributory ESA
  • New Style JSA

Joint claims

If you have a joint claim on the qualifying dates, a single payment of £300 will be sent using the same payment method, if you’re eligible.

Universal Credit eligibility

You are eligible for the £300 cost of living payment if you were entitled to a payment, or later found to be entitled to a payment, of Universal Credit for an assessment period that has not been announced yet.

Universal Credit ‘nil awards’

The guidance on GOV.UK explains: "You will not be eligible for the Cost of Living Payment if your benefit is reduced to £0 for the qualifying period. This is sometimes called a ‘nil award’.

Reasons your benefit may be reduced to £0 include:

  • you got more than one payment of earnings in your Universal Credit assessment period
  • your or your partner’s earnings went up
  • your or your partner’s savings went up
  • you started getting another benefit
  • you got a ‘sanction’ because you did not do something you agreed in your claimant commitment

You may still be eligible for a Cost of Living Payment if your benefit is reduced to £0 and one of the following applies:

  • money was taken off your benefit for other reasons, such as payments of rent to your landlord or for money that you owe
  • you had a hardship payment because you got a sanction and could not pay for rent, heating, food or hygiene needs

£300 and £299 cost of living payments

This guidance on GOV.UK will be updated with the qualifying dates for the £300 and £299 payments when they have been announced.

To keep up to date with the latest cost of living news, join our Money Saving Scotland Facebook page here, follow us on Twitter @Record_Money, or subscribe to our newsletter which goes out Monday to Friday - sign up here.

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