Universal Credit: How does the benefit cap affect payments? Grace period rules explained

Universal Credit payments can vary from person to person as they can be affected by elements such as having children, a disability or needing help to pay rent. However, there are standard allowances in place that all claimants will receive as a minimum and these range from £342.72 to £594.04 per month.

For those who are already receiving Universal Credit, the grace period will start on the first day of the assessment period in which their earnings go below the earnings threshold.

New claimants will see their grace period start from either the day after the last day they worked or, the payday when their earnings go below the earnings threshold.

The nine month grace period will also continue if the claimant stops claiming their Universal Credit and then starts again.

Once the nine month grace period ends, the government warns most Universal Credit payments will usually go down.

Universal Credit is not the only state benefit to be affected by the benefit cap as the following may also have their payments limited:

  • Bereavement Allowance
  • Child Benefit
  • Child Tax Credit
  • Employment and Support Allowance
  • Housing Benefit
  • Incapacity Benefit
  • Income Support
  • Jobseeker’s Allowance
  • Maternity Allowance
  • Severe Disablement Allowance
  • Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widow’s Pension if they started getting it before April 9 2001)

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