What is Universal Credit (UC)?
As of April 2017, Universal Credit started replacing certain benefits, namely:
1) Income-based Jobseeker’s Allowance (JSA)
2) Housing Benefit
3) Working Tax Credit
4) Child Tax Credit
5) Income-related Employment and Support Allowance (ESA)
6) Income Support
Like most other benefits, UC is means tested which means the amount you will be able to claim is dependent on your individual circumstances including your income and the number of children you have.
As a childcare provider, we understand how much parents depend on tax credit to supplement childcare costs and so it is really important that you understand in advance how these changes will affect you, if it hasn’t started already.
What Impact will this Have?
Until 2019, if you are claiming any of the above named benefits, unless your circumstances change, we do not suspect you will have to do anything unless the DWP gets in touch.
If your circumstances does change or they do they write to you, they will let you that your payments will stop and on what date.
At this point, you must end your claim and if there has been any over-payment, arrange to pay it back.
Once payment has stopped, you are then free to apply for UC. This will take a minimum of 6-8 weeks to process before any payment is made to you.
In that 8 week period, you will not receive any of the benefits listed above therefore you may not be able to pay your bills including your childcare costs.
In limited cases, if you can show that you are not able to cope without the monies for that period, you may be able to get an advance payment which you will have to pay back once your claim has been processed.
Our advice to you is therefore to ensure that your accounts (including nursery account) remain in credit to avoid unwarranted stress at this point.
What else do I need to Know?
The eligibility criteria will be changing…
Payments will be paid monthly…
If you and your partner are claiming from the same address, there will be one joint payment…
There are lots of other things to take note of as well, all of which is published on the government website https://www.gov.uk/universal-credit and updated as and when changes are made.
How Can You Prepare for this Process?
Start thinking about how much extra you can pay on top of your bills to build up as much credit as possible to cover you during that 8 weeks when you will not be receiving any benefits.
In the meantime, look out for other forms of support the government is offering towards childcare costs at https://www.childcarechoices.gov.uk/….