This information should not be relied upon as legal or professional advice. Read the disclaimer.

What is Universal Credit?

Universal Credit (UC) is a means-tested benefit for people both in and out of work. It is replacing six social security benefits and tax credits for working-age people and families:

  • Income-based Jobseeker’s Allowance
  • Income-related Employment and Support Allowance
  • Income Support
  • Housing Benefit
  • Child Tax Credit
  • Working Tax Credit

The Department for Work and Pensions (DWP) calls these ‘legacy benefits’.

With very limited exceptions, it’s no longer possible to make a new claim for a legacy benefit – UC is the only option for means-tested support. This also applies to people already getting a legacy benefit, whose circumstances change in a way that would previously have meant they needed to make a new claim for a different legacy benefit.

Legacy benefit claimants whose circumstances don’t change can remain on their existing benefits for the time being, although they can choose to claim UC. If they don’t choose to do so, they will remain on legacy benefits until the ‘managed migration’ stage, when the DWP will notify them they that they need to make a claim for UC. We don’t yet know when managed migration (which the DWP calls ‘Move to UC’) will begin.

This article outlines issues people thinking of claiming UC now might want to consider before making a claim.

No return to legacy benefits

When a person claims UC, any existing legacy benefits they’re getting will stop, and they won’t be able to claim legacy benefits again. This will happen even if, having met the basic conditions for UC, the outcome of the claim is that they are not entitled to UC.

Better off on Universal Credit?

Someone already receiving benefits or tax credits may be entitled to more, or less, if they claim UC. People moving onto UC at the managed migration stage who are entitled to an amount less than their existing benefits will receive ‘transitional protection’ so that they don’t lose out in cash terms at the point they move to UC. For people claiming UC in the meantime, however, there isn’t any such protection, unless they were getting the Severe Disability Premium.

The DWP has an online Benefits Checker tool people can use to get a quick idea of how much they might get if they claim UC. For a more detailed picture of the help people could receive, there are other online benefits calculators the DWP endorses.

In response to the coronavirus pandemic, the Government temporarily increased the standard allowances in UC by £20 a week from April 2020. While this means that more families will be better off claiming UC, the £20 uplift is due to be withdrawn in October 2021.

Capital rules

Tax credits aren’t usually affected by any capital (i.e. savings) a family holds, but UC can be. Savings of more than £6,000 may reduce the amount of UC received, and no UC is paid if total savings exceed £16,000. See the Commons Library constituency casework page How savings can affect benefits for further information.

Work-related conditions

Most people claiming UC will have to meet work-related requirements as a condition of receiving benefit – this is known as ‘conditionality’. This could include a requirement to look for work, or for more or better paid work, although which (if any) requirements apply will depend on the person’s situation. A claimant’s responsibilities are set out in their Claimant Commitment, which they agree with their Work Coach.

Under UC, more people will be subject to conditionality than in the legacy benefits system. Some people may become subject to work-related conditions for the first time on claiming UC. This includes people previously only getting tax credits, who were not subject to any work-related requirements.

The Citizens Advice website has a section people can use to find out which work-related activity group they’re in.

Self-employed people

Under UC, some self-employed claimants can be treated as if they earn the National Minimum Wage for the number of hours per week they are expected to work, even if they earn less than this amount. This is known as the  Minimum Income Floor (MIF), and where it applies claimants’ UC payments will be lower than if calculated on the basis of their actual earnings. There is no equivalent of the MIF in tax credits.

The MIF was suspended during the coronavirus pandemic but is expected to be reintroduced gradually starting from July 2021.

When to apply

When someone needs to claim UC, it is usually best to claim as soon as possible, as it takes at least five weeks before the first payment is made. However, where someone is claiming because their job has ended, it may make sense to wait until they receive their final wages before claiming. If they don’t, the final payment of wages might reduce their first UC payment. The rules here can be complicated and someone in this situation may want to get specialist advice.

Getting advice

This article sets out only some of the issues people thinking about claiming UC – and caseworkers helping them – should be aware of. Many other factors could be relevant, depending on a person’s situation.

Help to Claim advisers at Citizens Advice (England and Wales) and at Citizens Advice Scotland can help people with the early stages of a UC claim – over the phone, online over chat or face-to-face.

In Northern Ireland, Advice NI may be able to assist people thinking about claiming UC.

People can also find independent advice organisations where they are using the Advicelocal website.

Further information

GOV.UK, Understanding Universal Credit: New to Universal Credit: Is it for me?

Low Incomes Tax Reform Group, Universal Credit

Money and Advice Service, How will moving to Universal Credit affect me?

Shelter, How to claim universal credit

Gingerbread, What is Universal Credit?

Turn2us, Universal Credit (UC) – Switching from other benefits to Universal Credit

Universal Credit information sources, Commons Library constituency casework article

What benefits might people claim?, Commons Library constituency casework article


The Commons Library does not intend the information in this article to address the specific circumstances of any particular individual. We have published it to support the work of MPs. You should not rely upon it as legal or professional advice, or as a substitute for it. We do not accept any liability whatsoever for any errors, omissions or misstatements contained herein. You should consult a suitably qualified professional if you require specific advice or information. Read our briefing for information about sources of legal advice and help.