What Is Universal Credit?

Universal Credit is a benefit designed to help with living costs if you are on a low income, out of work or unable to work.

It is usually paid monthly and the amount you receive depends on your household circumstances.

You may be able to claim Universal Credit even if you are working.

Who might be able to claim Universal Credit?

Universal Credit may be relevant if you:

are unemployed
have a low income
work part-time
have had your working hours reduced
cannot work because of illness or disability
have children
have caring responsibilities
need help with eligible housing costs

There are eligibility rules, so being in one of these situations does not automatically mean you will qualify.

A benefits check can be a useful starting point.

What does Universal Credit include?

A Universal Credit award starts with a standard allowance.

Depending on your circumstances, additional amounts may be included.

These can relate to things such as:

children
childcare costs
housing costs
caring responsibilities
a health condition or disability that affects your ability to work

The amount is calculated for your household rather than every claimant receiving the same figure.

Can I get Universal Credit if I work?

Yes, depending on your circumstances.

There is no fixed number of working hours that automatically prevents you from receiving Universal Credit.

As your earnings increase, your Universal Credit will normally reduce.

For most earnings taken into account, Universal Credit currently reduces by 55p for each £1 earned.

Some households with children or a health condition affecting their ability to work can have a work allowance. This allows a certain amount to be earned before Universal Credit starts reducing.

There is a separate MH360 guide explaining Universal Credit and working in more detail.

Do savings affect Universal Credit?

They can.

Universal Credit is means-tested.

Under the current rules, money, savings and investments below £6,000 will not normally reduce your Universal Credit.

Between £6,000 and £16,000, your award can be reduced.

If you usually have more than £16,000, you will not normally be entitled to Universal Credit.

There are exceptions and special rules in some circumstances, so do not make an important decision about savings or other capital based only on these figures.

Can Universal Credit help with rent?

Universal Credit can include an amount towards eligible housing costs.

This can include rent for some people renting privately, from a housing association or from a council.

The amount you receive will depend on your circumstances and may not necessarily cover all of your rent.

Different arrangements can apply to some people living in supported, sheltered or temporary accommodation.

What if I have children?

Universal Credit can include additional amounts if you are responsible for children who normally live with you.

It can also provide help with eligible childcare costs for working parents.

The previous two-child limit ended on 6 April 2026, meaning current entitlement should be checked rather than relying on older information about the number of children for whom support can be included.

What if I have a health condition or disability?

If a health condition or disability affects your ability to work, you should report it as part of your Universal Credit claim.

Depending on your circumstances and assessment, you may qualify for an additional amount connected with having limited capability for work and work-related activity, often shortened to LCWRA.

The rules for this additional amount changed from 6 April 2026, including the introduction of different rates in some circumstances.

Because this area can depend heavily on individual circumstances and dates, check the current rules or seek benefits advice rather than relying on older information.

Universal Credit is also separate from disability benefits such as Personal Independence Payment (PIP). Receiving or considering one does not necessarily mean the other is irrelevant.

What if I care for somebody?

Universal Credit can include an additional amount for some people who provide substantial care for a person with a disability.

This is separate from Carer’s Allowance.

Your wider circumstances can affect what you receive, so a complete benefits check is useful if you have caring responsibilities.

How is Universal Credit calculated?

Universal Credit normally works through monthly assessment periods.

During each assessment period, your circumstances are used to calculate what you should receive.

Things such as changes in earnings can therefore affect the amount paid from one month to another.

This is particularly relevant if your earnings vary.

When will I receive my first payment?

Your first Universal Credit payment will usually arrive around five weeks after you make your claim.

If you do not have enough money to manage while waiting, you may be able to apply for an advance.

An advance is not extra Universal Credit.

It will normally need to be repaid through deductions from future Universal Credit payments.

Consider how those repayments may affect the amount you will have available in future months.

How do I claim Universal Credit?

Universal Credit is normally claimed online.

You create a Universal Credit account, complete your claim and provide information about your circumstances.

If you live with a partner, you will normally both need accounts which are linked to make a joint claim.

You may need information about:

your identity
income and employment
savings and investments
housing costs
children
childcare costs
health conditions
caring responsibilities
other benefits or income

You will also normally have an appointment with Jobcentre Plus as part of the claim process.

What if I already receive older benefits?

Universal Credit has been replacing several older means-tested benefits, including Housing Benefit and income-related Employment and Support Allowance.

If you still receive a benefit that Universal Credit is replacing, do not simply make a Universal Credit claim because you have read about it.

Making a Universal Credit claim can stop some existing benefits, and in some circumstances that change cannot simply be reversed.

You may receive a Migration Notice telling you that you need to move to Universal Credit by a particular deadline.

If you are unsure how moving to Universal Credit could affect you, get benefits advice before making a voluntary claim.

What happens if my circumstances change?

You need to report relevant changes in circumstances.

This could include changes involving:

work or earnings
living with a partner or separating
children
housing
health
caring responsibilities
savings and investments

Changes can affect how much Universal Credit you should receive.

Reporting them promptly can help reduce the risk of being underpaid or receiving money that later needs to be repaid.

How can I find out whether I might qualify?

A free benefits calculator can give you an initial estimate.

If your circumstances are complicated, you are moving from older benefits or you are unsure how health, caring, savings or work affect your position, benefits advice may be useful.

MH360 Entitled can also help people explore benefits and financial support they may be missing.

The important question is not:

“Am I unemployed?”

It is:

“Based on my household circumstances and income, might I be entitled to Universal Credit?”

7.9: What Benefits Might I Be Entitled To?

7.10: How Can I Check Whether I’m Missing Out on Benefits?

7.12: Can I Get Universal Credit if I’m Working?

7.13: What Help Is Available if I’m Too Ill to Work?

7.14: What Financial Support Is Available if I Have a Disability or Long-Term Health Condition?

7.15: What Benefits and Financial Help Are Available for Carers?

7.17: I’ve Had a Change in Circumstances, Do I Need to Report It?

7.31: What Help Can I Get With My Rent?

Important information

This guide provides general information and is not intended to provide benefits, financial, legal or other professional advice. Universal Credit rules, rates and eligibility criteria can change, and individual circumstances can be different. Check current information from official sources or seek advice from an appropriately qualified benefits adviser before making important decisions.