The Department for Work and Pensions (DWP) offers Universal Credit claimants a potential loan of up to £812 through a Budgeting Advance to assist with urgent expenses. This financial aid can be used for home repairs, additional work-related costs, relocation, or covering funeral expenses.
Repayment of the Budgeting Advance is required through future Universal Credit payments, typically within a two-year timeframe, without any interest charges. The loan amount ranges from a minimum of £100 up to £348 for individuals, £464 for couples, or £812 for those with dependent children.
Savings exceeding £1,000 (or £2,000 for individuals aged 63 and above) can reduce the loan amount available based on the excess savings. For instance, having £1,100 in savings would decrease the Budgeting Advance or Loan by £100.
To qualify for a Budgeting Advance, individuals must have received Universal Credit for at least six months. Exceptions may apply for those needing financial assistance to secure or retain employment. Earnings in the past six months should not exceed £2,600 (or £3,600 for couples). For a Budgeting Loan, a minimum of six months of receiving specific benefits is required.
Subsequent Budgeting Advances or Loans are not permitted until the first loan is repaid. Potential eligibility criteria for a budgeting advance are provided by Citizens Advice.
Applicants can request a Budgeting Advance by messaging their Universal Credit online journal, contacting the nearest jobcentre, or calling the Universal Credit helpline on 0800 328 5644.
Even if Universal Credit claims cease, repayment of the Budgeting Advance is still mandatory. The DWP has the authority to recover outstanding amounts by contacting the employer or utilizing debt collection services.
Universal Credit comprises a standard allowance, which is the fundamental payment received before factoring in additional elements like dependent children or incapacity due to health issues, along with any applicable deductions.
