Millions of people will receive a new cost of living payment next week but lots of people are expected to miss out. The Department for Work and Pensions (DWP) will deliver the first part of a £900 cost of living payment next month to help with rising living costs.
The money will land in bank accounts automatically between Tuesday, April 25 and Wednesday, May 17. The money is the first of three DWP payments totalling £900 for means-tested benefits claimants as part of the government’s cost of living support package. Additional £150 disability payments and £300 pensioner payments being rolled out later this year mean some people could receive up to £1,350, though not everyone will qualify for all of the payments.
Just over eight million people in the UK, including 433,000 in Wales, are estimated to be eligible for the first cost of living payment, providing a much-needed boost to struggling households. But despite this, a lot of people won't be eligible at all.
Read more: 'My universal credit was cut - now I'm struggling to pay my bills'
Here's everything you need to know about the payment, including who does and doesn't qualify. To get all the latest money-saving news straight to your inbox twice a week sign up here.
Who gets the money?
The £301 payment will be paid to eligible households receiving the following benefits:
- income-based jobseeker’s allowance (JSA)
- income-related employment and support allowance (ESA)
- Income support
- Pension credit
- Universal credit
- Child Tax credit
- Working tax credit
The payment will be made separately from your benefit payments. You will not get a payment if you are only getting New Style ESA, contributory ESA, or New Style JSA.
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. These payments are not taxable and will not affect the benefits or tax credits you get.
Who is not eligible?
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
When will I get paid?
If you’re entitled, you will get:
- £301 paid between April 25, 2023 and May 17, 2023 for most people on DWP benefits
- £301 paid between May 2 and 9, 2023 for most people on tax credits and no other low income benefits
- £300 paid during autumn 2023 for most people
- £299 paid during spring 2024 for most people
If you’re getting both child tax credit and working tax credit, you will receive a cost of living payment for child tax credit only, which will be paid by HMRC.
If you’re getting tax credits from HMRC and a low income benefit from DWP, you cannot get a cost of living payment from both HMRC and DWP. You will usually be paid by DWP only. Your payment might come later, for example if you’re awarded a qualifying benefit at a later date or you change the account your benefit or tax credits are paid into. You will still be paid the cost of living payment automatically.
What other support is available?
As well as the £301 cost of living payment, there will be two further instalments in the autumn and next spring of £300 and £299 respectively. There will also be a £150 disability cost of living payment in summer 2023, and a £300 top-up to the winter fuel payment for 2023/24. You can find out more about these payments here.
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