The Department for Work and Pensions (DWP) is nearing completion of the transition to Universal Credit by sending out final notifications to benefit recipients this month. Universal Credit has replaced several older benefits for many UK households, such as Tax Credits, Income Support, income-based Jobseeker’s Allowance, and Housing Benefit.
While most claimants have already transitioned, individuals receiving income-related Employment and Support Allowance (ESA) will soon be contacted for migration, with all remaining individuals expected to be reached by September 2025. The DWP aims to finalize the “managed migration” process to Universal Credit by March 2026 and will issue migration notices to those pending transfer.
Claimants have a three-month window to switch to Universal Credit after receiving the notice, as existing benefits will cease thereafter. The DWP states that 55% of claimants will benefit from Universal Credit, 35% may see reduced benefits, and the remainder will experience no change. Those facing reduced benefits will receive monthly transition payments until their Universal Credit matches their previous benefit amount.
It’s crucial to wait for the managed migration process to receive transitional payments. Upon switching to Universal Credit, there is a five-week waiting period for the first payment, though some legacy benefits like income-related ESA provide additional support during the transition.
Universal Credit comprises a standard allowance before considering any additional factors like childcare or health issues. Earnings from work impact the payment through a taper rate of 55%, deducting 55p from the maximum Universal Credit payment for every £1 earned. Some individuals qualify for a work allowance, allowing them to earn a set amount before their Universal Credit is reduced.
The transition to Universal Credit involves various elements like the standard allowance, child element, limited capability for work, carer element, work allowance, and childcare costs element.
