This is information on benefits for people of working age who are unemployed or on a low income.
Disclaimer: I am not an expert on benefits and the situation continues to change so please check.
Universal Credit
This is a means tested benefit for people who are unemployed or on a low income and have savings or capital of under £16,000.
It replaces previous means tested benefits such as income based Job Seekers Allowance and income based Employment and Support Allowance.
If you are currently claiming Tax Credits get advice before claiming Universal Credit as some people may get less money.
If you have a partner, their income and savings will be taken into account. You need to jointly have under £16,000 of savings or capital between you.
You get the full amount if you have savings or capital of up to £6,000, after that the amount tapers off and stops if you have £16,000 or more. A property you live in does not count but any property you own which you do not live in will normally count as capital.
There are some capital disregards listed here: http://data.parliament.uk/DepositedPapers/Files/DEP2019-0465/Capital_disregards_v11.0.pdf
Universal Credit covers your living expenses and rent expenses. If you receive Universal Credit you may also get help with paying your Council Tax and free prescriptions depending on your income.
Previously it was assumed that once you have been in self-employment for 12 months you would have been working for a certain number of hours each week and earning at least minimum wage for those hours. This would typically have been 35 hours but may be reduced if you have caring responsibilities, children or a disability it could be less. This is the ‘minimum income floor’ and has been relaxed for the coronavirus outbreak.
The Prime Minister announced on 20th March 2020 that there will be an increase of £1,000 per year for Universal Credit to bring Universal Credit in line with the payments for Statutory Sick Pay which employed people can get.
If you pay a mortgage you may be able to receive help to pay towards your mortgage interest after you have been claiming for 39 weeks but it will be a loan which you will have to pay back.
If you pay rent you can claim Local Housing Allowance which is part of Universal Credit.
The Prime Minister announced on 20th March 2020 that the rent allowance has been increased to cover the cost of the lowest 30% of rents in your area, it had previously been frozen.
There is more information here: https://www.gov.uk/guidance/local-housing-allowance
Most people can claim online. There is more information about Universal Credit and how to claim here: https://www.understandinguniversalcredit.gov.uk/
Contributory benefits
If you can’t claim Universal Credit you may be able to claim contributory benefits instead.
These are for people who have paid enough National Insurance in the past two to three years. National Insurance credits count – you get these if you are claiming out of work benefits.
Contributory Job Seekers Allowance
These are based on whether you have paid enough National Insurance contributions in the last two to three years. If you were employed and have paid Class 1 National Insurance contributions you can claim contributory Job Seekers Allowance for six months. Self employed Class 2 National Insurance contributions do not count. You need to be actively seeking work.
There is some more information here: https://www.gov.uk/jobseekers-allowance
Contributory Employment and Support Allowance
Both Class 1 and Class 2 National Insurance Contributions count towards claiming Employment and Support Allowance. You can only claim this if you are unable to work.
Note that coronavirus (Corvid 19) is a notifiable illness so you will automatically get Employment and Support Allowance if you have this.
The benefit is payable from day one of your illness during the coronavirus outbreak.
If you remain ill, you will get the benefit for three months after which you will have an assessment to decide if you need to be in the Work Related Activity Group or Support Group.
You can claim contributory Employment and Support Allowance for up to a year in total if you are placed in the Work Related Activity Group or indefinitely if you are placed in the Support Group.
You need to fill in a claim form which has a series of descriptors which score you points. You need to score 15 points to get in the Work Related Activity Group, or satisfy one of the descriptors for the Support Group (these are most of the descriptors which attract 15 points).
You are allowed to do a small amount of work, no more than 16 hours of work per week and earn no more than the equivalent of 16 hours of work at minimum wage. This is known as Permitted Work and you need to ask for permission to do this.
There is some more information here: https://www.gov.uk/employment-support-allowance
Benefits calculators
If you want to find out how much you will get you can use a benefits calculator here: https://www.gov.uk/benefits-calculators
Note that these may not yet have been updated to take into account the new announcements by the Prime Minister on 21st Match 2020 and they will not include any contributory benefits, only means tested benefits.
If you are in any doubt, apply for benefits anyway. Every year millions of pounds worth of benefits go unclaimed.