TIP: Some savings/capital don’t count, they are disregarded. This includes back payments of Personal Independence Payment / Adult Disability Payment for 12 month (or longer in some circumstances).
Savings/Capital
If you have more than £6,000 of savings/capital it will reduce your Universal Credit payment. The DWP will take off £4.35 a month for each £250 (or part of £250) of savings/capital above £6,000.
You’ll no longer be eligible for Universal Credit if you have £16,000 or more in capital (unless you have moved onto UC after receiving a Migration Notice and are entitled to the Transitional Capital Disregard).
Capital includes things like savings, interest, certain property (that you don’t live in) and shares.
Example:
Yvonne has £6,720 in savings. This is £720 over £6,000 – which is 2 full lots of £250 and one partial £250. This means that her savings reduce her Universal Credit by 3 x £4.35 = £13.05 a month
NOTE: Certain types of savings/capital are not counted. These include:
- Payments made for arrears of, or compensation for late payment of some social security benefits – for 12 months or longer in some cases.
- Lump Sum Bereavement Support Payment – for 12 months from date of payment.
- Certain types of property (and in certain situations the proceeds for the sale of a property).
- Rights in schemes such as pension schemes, life insurance and funeral plans.
- Amounts earmarked for special purposes such as house purchase or essential repairs to property.
- Certain personal injury payments.
- Certain compensation payments such as, support related to Creutzfeldt-Jacob disease, or for those infected from contaminated blood products, payments from the London Bombings Relief Charity Fund (LBRCF), ‘We love Manchester Emergency Fund’ (WLMEF) and the ‘London Emergencies Trust’ (LET), payments in relation to the Grenfell Tower fire, the failings of the Post Office Horizon system and payments under the Windrush Compensation Scheme.
- Savings over £16,000 for those claimants manage migrated onto UC who are entitled to the ‘Transitional Capital Disregard’ – click here for more information.
If you have savings/capital over £6,000 and you are not sure if some should be disregarded, then speak to a Benefits Adviser.