Millions of households claiming income-related benefits from the Department for Work and Pensions (DWP) or HM Revenue and Customs (HMRC) will see a £301 cost of living payment land in their bank account over the next few weeks. DWP payments will arrive between April 25 and May 17 while those on Tax Credits can expect to receive the lump sum between May 2-9.
In total, more than eight million eligible claimants are due the first part of the £900 means-tested cost of living payment with further payments of £300 and £299 set to arrive in the autumn and spring 2024. Payments will appear on accounts as ‘DWP COLP’, along with the claimant’s National Insurance number.
However, guidance issued by DWP on GOV.UK warns people to be on the lookout for scammers asking them to apply for the state-funded support. All the cost of living payments will be made automatically, nobody needs to apply - if you are asked, it’s probably a scam.
The guidance reminds anyone due a payment: “You do not need to apply. If you’re eligible, you’ll be paid automatically in the same way you usually get your benefit or tax credits. This includes if you’re found to be eligible at a later date.”
It also warns: “If you have had a message asking you to apply or contact someone about the payment, this might be a scam. ”
Qualifying benefits for £301 payment
The £301 payment will be made to eligible households receiving the following benefits:
- 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 £301 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 £301 will be sent using the same payment method, if you’re eligible.
Universal Credit eligibility
You are eligible for the £301 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 ended in the period January 26, 2023, to February 25, 2023.
Universal Credit ‘nil awards’
Updated 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
Pension Credit and other income-related benefits
Guidance on GOV.UK explains that people on Income-based JSA, income-based ESA, Income Support and Pension Credit will be due the £301 payment if they were entitled to a payment - or later found to be entitled to a payment - of those benefits for “any day in the period January 26, 2023 to February 25, 2023”.
It adds: “You are also eligible if you are entitled to one of these benefits for any day during this period but you do not receive a benefit payment because your entitlement is between 1 penny and 9 pence.”
New Pension Credit claims and £301 payment
The DWP is also encouraging low-income pensioners not already getting Pension Credit to check their eligibility, as they can still qualify for the £301 cost of living payment if they make an application for Pension Credit application before May 19, 2023, which later turns out to be successful.
This is because Pension Credit is a retrospective benefit that can be backdated by up to three months, taking it to within the qualifying period (January 26 - February 25).
People can check their eligibility for Pension Credit using the online calculator on GOV.UK here or by calling the Pension Credit helpline on 0800 99 1234.
Tax Credits
People on Working Tax Credits or Child Tax Credits and a qualifying DWP benefit will receive their payment from DWP between April 25 and May 17, 2023. For those in receipt of Tax Credits-only, the payment will be made through HMRC between May 2 and May 9, 2023.
You will be eligible for the £301 payment if you received a payment of Tax Credits for any day in the period January 26, 2023, to February 25, 2023, or you are later found to have been entitled to a payment for this period.
The scam warning applies to anyone due a cost of living payment this year, including the £150 payment for those on disability benefits and pensioner households due the £300 payment on top of the 2023/24 Winter Fuel Payment.
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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