Martin Lewis hosted a special edition of The Money Show Live this week focusing on unclaimed benefits.
With the help of two benefit exports - Minesh Patel from Macmillan Cancer Support and Lee Healy from Income Max - the money-saving expert encouraged millions of people watching the award-winning show to check if they are missing out on extra financial support, even if they are earning up to £50,000.
Martin told viewers: “It’s a tough time for many people’s pockets as we know, yet up to seven million of you are missing out on benefits and state help that you are entitled to.
“And don’t think ‘it’s not me’, the benefits web can stretch as high as some people with £50,000 of family income.”
The consumer champion explained how “at least one million people” are missing out on Universal Credit, simply by not making a claim to the Department for Work and Pensions (DWP).
He said: “ Universal Credit is for those who are unemployed or working on lower incomes, usually aged between 18 and up to State Pension age (66).
“The amount you get is based on your household income, your childcare costs and your housing costs.
“It could be up to £1,900 you get in some very extreme circumstances, but the amount you get is reduced if you or your partner have £6,000 in savings and if you’ve got over £16,000 you won’t get anything.”
The financial guru also shared his “very rough rule of thumb” for benefits eligibility.
He said: “If you have a total family income of below £30,000, I would absolutely spend time to check if you’re eligible for Universal Credit.”
However, Martin warned that he was not saying “you are eligible” for the benefit, but it is worth spending a few minutes to check online using a free, independent benefits calculator to check you’re not missing out on extra financial support.
Martin also advised anyone who may have applied unsuccessfully for Universal Credit before November last year, to try again as the DWP rules have changed.
He explained: “If you tried before November, things have changed, 600,000 more people are now eligible for Universal Credit because they [DWP] increased they increased the Work Allowance and they decreased the amount you lose in the taper rate rule.”
And if you are entitled to Universal Credit, Martin shared how this gives claimants access to the Help to Save scheme.
He explained: “That’s where you can save up to £50 a month and you get a 50 per cent bonus, totally unbeatable, on the highest amount you have in over two years, even if you have nothing left at the end.”
What you need to know about Universal Credit
New claimants may not be entitled to the full benefit amount, but they could be eligible for elements of it, including a Council Tax Reduction or help paying rent.
It could also help top-up wages for those on a low income.
In the past, people on a low-income would apply for Working Tax Credits, however, this is a legacy benefit which is gradually being phased out as claimants migrate to Universal Credit.
How to claim Universal Credit
The UK Government states that a person may be able to get Universal Credit if:
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You are on a low-income or out of work
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You are 18 or over (there are some exceptions if you’re 16 to 17)
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You are under State Pension age (or your partner is)
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You and your partner have £16,000 or less in savings between you
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You live in the UK
If you live with your partner, their income and savings will be taken into account, even if they are not eligible for Universal Credit.
It is worth noting that you won't be able to get any of the means-tested benefits if your capital and savings amount to more than the upper limit of £16,000.
These include:
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Universal Credit
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Income-related Employment and Support Allowance
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Income-based Jobseeker's Allowance
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Income Support
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Housing Benefit
However, your savings and capital (or your partner’s savings, capital and income) are not taken into account when claiming ‘New Style’ Jobseeker's Allowance (JSA) and this particular benefit can be obtained at the same time as Universal Credit - or on its own.
‘New Style’ JSA is a contribution-based benefit. This means you may be able to get it if you’ve paid enough National Insurance (NI) contributions in the two full tax years before the year you’re claiming in.
It is paid fortnightly and if you qualify, you can get 'New Style' JSA for up to 182 days.
If you qualify for both ‘New Style’ JSA and Universal Credit, any ‘New Style’ JSA you receive will be taken into account as income for Universal Credit.
To make a claim for Universal Credit, visit the gov.uk website here and for more information on claiming Jobseeker's Allowance, read more here.
Universal Credit until April 2022 (monthly rates shown)
Standard allowance
Single
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Single under 25: £257.33
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Single 25 or over: £324.84
Couple
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Joint claimants both under 25: £403.93
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Joint claimants, one or both 25 or over: £509.91
What if you have a job?
There is no limit to how many hours you can work while claiming Universal Credit, but only people on a low income are eligible, and this threshold depends on individual circumstances.
The amount a working person receives is dependent on how much they earn.
It reduces as someone earns more - for each £1 a claimant earns in their job, their payment will reduce by 55p, with the aim being that their payments will gradually reduce until they are financially independent.
That is, unless the person is eligible for a Work Allowance, which includes those who have responsibility for a child and those whose working ability is affected by a disability or health condition.
In these circumstances, they will be able to earn up to a set amount without their benefits being affected.
The set amount is £335 per month for people who already have extra help to cover housing costs, and £557 per month for people who do not.
For anything they earn above that amount, the £1 to 55p rule will apply.
Housing costs
You could get money to help pay your housing costs. How much you get depends on your age and circumstances, but the payment can cover rent and some service charges.
If you’re a homeowner, you might be able to get a loan to help with interest payments on your mortgage or other loans you’ve taken out for your home.
What documents you need to apply for Universal Credit
You will need:
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Your bank, building society or credit union account details
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An email address
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Information about your housing, for example how much rent you pay
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Details of your income, for example payslips
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Details of savings and any investments, like shares or a property that you rent out
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Details of how much you pay for childcare if you’re applying for help with childcare costs
If you don't provide the right information when you apply it might affect when you get paid or how much you get.
Verifying your identity online
You will need some proof of identity for this, for example your:
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Driving licence
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Passport
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Debit or credit card
To make a claim for Universal Credit, visit the gov.uk website here
Benefit Calculators
You can also use an independent benefits calculator to find out:
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What benefits you could get
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How to claim
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How your benefits will be affected if you start work
These calculators are free to use, anonymous, and could indicate benefits you're missing out on.
Where to find help
Advice Direct Scotland
This new online tool is the first to fully integrate devolved benefits, including the new Scottish Child Payment.
It provides a free and impartial assessment of entitlement to a range of benefits such as Universal Credit, crisis grants and support payments.
Turn2us
Information on income-related benefits, Tax Credits, Council Tax Reduction, Carer’s Allowance, Universal Credit and how your benefits will be affected if you start work or change your working hours
Policy in Practice
Information on income-related benefits, Tax Credits, contribution-based benefits, Council Tax Reduction, Carer’s Allowance, Universal Credit, how these are calculated and how your benefits will be affected if you start work or change your working hours
entitledto
Information on income-related benefits, Tax Credits, contribution-based benefits, Council Tax Reduction, Carer’s Allowance, Universal Credit and how your benefits will be affected if you start work
What you will need
You will need accurate information about your:
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Savings
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Income, including your partner’s
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Existing benefits and pensions (including anyone living with you)
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Outgoings (such as rent, mortgage, childcare payments)
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Council Tax bill
For more information about Universal Credit, visit the GOV.UK website here.
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