Universal Credit Work Allowance 2022: all you need to know

8 December 2022 by Robin - 5 minutes of reading time

universal credit work allowance

What is a Universal Credit work allowance? Am I eligible? If you get Universal Credit, you may be eligible to still receive payments while working. Indeed, this is likely the case if you have children. Your Benefits will tell you all you need to know about the universal credit work allowance in 2022.

How much is Work Allowance Universal Credit?

How much Work Allowance am I entitled to? 

You may be responsible for a child, or have limited capability for work. If this is the case, you may have a work allowance. Then, exactly how much Universal Credit work allowance you can get in 2022 depends on whether or not you receive help with housing costs.

In fact, you may cover housing costs with your Universal Credit payments. Moreover, you may be in a temporary accommodation, and receive help through your Local Authority. In this case, your Universal Credit Work Allowance in 2022 is £335 monthly.

However, you may not receive any kind of housing support. If this is the case, your Universal Credit work allowance in 2022 is £557 monthly.

Furthermore, your work may require you to make one-time payments. Indeed, this may be costs for licences, equipment, travel, or even a uniform. Furthermore, your employer may not agree to reimburse you for them. If this is the case, they are called unreimbursed work expenses.

Starting work or working in general might lead to unreimbursed work expenses. However, you might be able to offset them through your Universal Credit. Talk about this with your work coach. They could be able to help you.

What is the Work Allowance for Universal Credit?

Universal Credit is a monthly benefit for those who are out of a job, or cannot work. As such, once you begin to work, the Universal Credit you receive will decrease. This will be over time, and gradual. However, the work allowance allows you to earn a certain amount before your Universal Credit payments are impacted.

You may not suddenly stop receiving Universal Credit because you start working. In fact, this is the case for Jobseeker’s Allowance (JSA), but not for Universal Credit.

There is a certain amount that you may earn before your income and work affect how much Universal Credit you get. Work Allowance is the name for this amount. In other words, work allowance is your Universal Credit income limit.

Universal Credit taper rate

Once you start to work, if you earn more than your work allowance, you will receive less. Indeed, the Universal Credit amount that you get will be impacted. Note that this is only if you earn more than your work allowance.

However, at what rate will my Universal Credit be reduced? The answer to this question is 55%. By itself, it may not mean much to you. For every £1 in your income that is more than your work allowance, your Universal Credit payments will be reduced by 55p. Additionally, this subtraction is done automatically.

Let’s look at an example. You are single, 26 years old, and have a child born before 6 April 2017. In fact, you receive £607.34 monthly. However, you get help covering housing costs through your local authority, and get £500 in income monthly. Then, you will have £90.75 subtracted from your payments monthly.

Who gets work allowance universal credit

What is Universal Credit Work Allowance?

Not everyone that receives Universal Credit is eligible to have a work allowance in 2022. A couple of things need to be true in order for that to be the case. More specifically, one of the following must be true for either you or your partner:

  • You are responsible for a child;
  • You are limited in your ability to work.

If one of the following is true for you, then you may be eligible for a work allowance. Then, what will affect your work allowance limit is if you are getting help with housing costs.

How much is Universal Credit?

You may not be eligible for a Universal Credit work allowance in 2022. Even if you are, it is important to know how much this benefit can get you. It is made up of two different parts: the standard allowance and extra payments. Indeed, you may be eligible for extra amounts if one of the following applies to you:

  • You have children;
  • A health condition or disability impacts your ability to work;
  • You do not get enough to pay your rent.

Furthermore, the standard allowance rate of Universal Credit is as follows:

Universal Credit standard allowance rates in 2022
Your personal circumstance Standard allowance rate (per month)
You have a partner, and at least one of you is 25 years or older £509.91 (for the couple)
You have a partner, and you are both younger than 25 years old £403.93 (for the couple)
You are younger than 25 years old and single £257.33
You are 25 years or older and single £324.84

The benefit cap also impacts how much Universal Credit you can get. It is a limit on the total number of benefits you are able to receive. As such, you may not earn more Universal Credit and other benefits than what is allowed with the benefit cap.

Can I earn more Universal Credit if I have children?

On top of getting a Universal Credit work allowance if you have children, you will be able to have more Universal Credit overall. Indeed, this is because children under your responsibility count for extra payments.

The date of birth of your children are relevant to determine how much you may get. In fact, if your older or first child is born before 6 April 2017, you may receive more for them. Conversely, if they are born later than this date, you will be eligible for slightly less.

Note that there is a fixed rate for any additional child that you have. Additionally, your child may be disabled. If this is the case, you will already receive an extra payment. However, on top of this, you will also get a payment because of their disability.

Can Universal Credit cover childcare?

Universal Credit can cover costs incurred by ‘approved’ childcare. Indeed, you may get up to 85% of your costs covered with this benefit. However, there is a maximum amount. You may be paid back up until a certain point:

  • £646 (this is if you want to cover the costs for one child);
  • £1108 (if you want to cover the costs for 2 children or more).
Autres questions fréquentes

Robin is a writer for Your Benefits, writing about aids that people may be entitled to. He is currently working on his Master in journalism at the Institut Supérieur de Formation au Journalisme in Lille.

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