This week, the changes to Universal Credit announced last month by the Chancellor, Rishi Sunak, in the Autumn Budget came into effect. These changes see the dreaded Universal Credit taper (how much an individual’s Universal Credit gets reduced by for every pound they earn) reduced from 63 pence to 55 pence, allowing millions of working Brits in receipt of the benefit to keep more of their earnings.
The other change is to the work allowance, which is the amount some claimants can earn before the taper kicks in and this has been raised by £500 per year.
The current work allowance is:
- £293 – if you are getting housing costs as part of your Universal Credit award, or housing costs from the local authority because you are in temporary accommodation
- £515 – if you do not receive housing support
People are eligible for work allowance if they or their partner have:
- Responsibility for a child
- Limited capability for work
The Chancellor said the changes mean that nearly two million families will keep on average an extra £1,000 a year.
Commenting on this week’s changes, Sherrelle Collman, Managing Director of Caridon Landlord Solutions, said: “These changes help to ensure working people in receipt of Universal Credit keep more of their hard-earned money. However, it does not make up for the loss of the £20-a-week uplift introduced during the pandemic, which has now been removed. Those still looking for work and nearly 2 million people unable to work because of disability, health issues or caring responsibilities are still over £1,040 a year worse off.
From landlords’ perspective, many who will have working tenants on Universal Credit as a result of the pandemic, this is a positive change which should help more tenants keep up with rental payments.”