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A cautionary note has been issued to millions of Universal Credit recipients who have any amount in savings. It’s common knowledge that if savings exceed £16,000, eligibility for Universal Credit is lost.
However, the Department for Work and Pensions (DWP) is reminding claimants that this figure is merely the upper capital limit, and having savings less than this can still affect your benefit amount.
The lower limit for savings on Universal Credit is actually £6,000. For every £250 you have above this, your payment will be reduced by £4.35.
This is also rounded up, so if you have £6,400 in savings, a total of £8.70 will be deducted from your payments.
Few people are fully aware of what constitutes savings or capital in the DWP’s calculations. For Universal Credit, it includes cash, any savings accounts, property you own but don’t live in, cryptoassets, inheritance payments and even money that belongs to someone else but is in your name, reports Birmingham Live.
Your personal possessions are not taken into account, though, the DWP guidelines on its website confirms.
Some types of money, savings, investments or other assets might not affect your claim for Universal Credit. You still need to tell us about these so we can decide whether to take them off your overall money, savings and investments.
All money, savings and investments you have in the UK and abroad are taken into account, including cash and money in your bank account, including your main bank account.
The DWP will consider a range of accounts, including current and digital-only accounts such as PayPal, as well as savings accounts with banks, building societies, credit unions, Help to Save, Post Office, and National Savings and Investments (NSandI).
This also extends to savings held in your name for children, money that belongs to someone else but is in your name, savings set aside for essential building work (unless it’s from a grant or loan), and savings for medical care. Individual Savings Accounts (ISAs) are also included: cash, stocks and shares, Innovative Finance, Help to Buy, and Lifetime ISAs.
Other financial assets taken into account include Premium Bonds, dividends, stocks and shares, and cryptoassets. Property you own but do not live in, property, land and savings abroad, inheritance payments, business accounts and assets for businesses that closed over six months ago, and money in trust funds are also considered, except in certain circumstances.
Unspent benefits, such as Child Benefit, Personal Independence Payment (PIP) and Disability Living Allowance (DLA), and unspent income are also factored into the assessment.
