DWP could hand thousands of Universal Credit claimants extra money this autumn

The Department for Work and Pensions has issued an update outlining the rules when transitioning from benefits such as housing benefit onto Universal Credit

Thousands of Universal Credit recipients could be given additional funds for a temporary period to prevent a sudden drop in income this autumn. The extra amounts even surpass what they would usually receive in their monthly payments - and it's all part of the continued overhaul of the benefits system.

Currently, just under seven million people are on Universal Credit. This figure is rising as claimants are switched from older forms of welfare support.

These legacy benefits include tax credits, Income Support, Housing Benefit, income-based Jobseeker's Allowance and income-related Employment and Support Allowance. As part of the 'managed migration' this autumn, thousands more individuals are being 'transitioned'.

Households are receiving letters and given a three-month window to apply for Universal Credit before their existing benefits cease. Now the Department for Work and Pensions (DWP) has issued an update outlining the rules for increasing people's Universal Credit during this transition.

It states that an extra amount, known as a transitional element, can be paid under certain conditions and has clarified how this operates. The DWP explains that the transitional element can be added if someone has received a Migration Notice letter and has moved to Universal Credit by the specified deadline date.

Essentially, this element bridges the gap between what people were receiving on their old benefits and what they would be due to receive in Universal Credit, reports Birmingham Live. DWP statistics suggest that by late 2025, as Universal Credit is fully rolled out, around 2.2 million households are expected to receive transitional protections to prevent their benefits from dipping below former levels.

Alongside this, around 1.2 million families are anticipated to maintain their current benefit amounts. And 3.8 million could see increased payments under Universal Credit.

The DWP guidance states: "When a claim is made and verified, the transitional element is calculated using a Universal Credit amount that's based on your known circumstances from the day before your claim. This amount is referred to as the indicative Universal Credit award.

They further explained: "At this point, the transitional element is the difference between the indicative Universal Credit award and your previous legacy benefit amount. It aims to protect your benefit entitlement at the point of moving to Universal Credit."

This transitional element hinges on details provided by claimants in their Universal Credit applications. It incorporates factors such as work status, family composition, income, savings and investments, children and childcare costs, potential disabilities or care responsibilities, and specifics of any benefits already being received.

The method for determining eligibility for Universal Credit is comprehensive, officials say. It involves checks against data from the Department for Work and Pensions (DWP), HM Revenue & Customs (HMRC), and local councils.

This is especially so in cases like Housing Benefit. After considering any benefit cap deductions, DWP may apply a transitional element to mitigate any reduction in benefits, aligning Universal Credit with former benefit amounts.

This system of transitional protection aims to prevent income loss for those transitioning to Universal Credit, maintaining a level consistent with their previous benefits. This remains unaffected by the April rise in Universal Credit, resulting in a decrease in the transitional portion.

The DWP has highlighted: "If your circumstances change after you've made your claim, any transitional protection you receive may stop."