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Last updated:
18/06/2020

How will Universal credit affect Housing Benefit?

Universal Credit is replacing Housing Benefit. We explain what this means for you, how Universal Credit will affect your Housing Benefit and the differences between the two benefits.

If you currently receive Housing Benefit, you will have to move onto Universal Credit by 2023.

Moving to Universal Credit from Housing Benefit

If you currently claim Housing Benefit, you can stay on the benefit at the moment - unless you've had a change of circumstances.

If you haven't had a change of circumstances, you won't need to claim Universal Credit until the Department for Work and Pensions (DWP) contacts you - this is called managed migration.

If you haven't had a change in circumstances, you will be able to claim Transitional Protection - a top-up award which ensures you are not financially worse off when you claim Universal Credit.

Change in circumstances

If your circumstances have changed, you will have to move from Housing Benefit to Universal Credit - this is called natural migration - for the following reasons:

  • You have a first child.
  • You moved home, especially in a new local authority.
  • Claiming Child Tax Credits and start working.

Two-week Housing Benefit payment when moving to Universal Credit

When you move from Housing Benefit to Universal Credit your Housing Benefit will continue to be paid to you for two weeks - this is to help with your housing costs while you wait for your first payment of Universal Credit. You will not need to pay it back.

The two-week benefit will be paid automatically when you first claim Universal Credit. How you receive your money will be determined by your usual Housing Benefit payment cycle and your current scenario:

Housing Benefit payment cycle How your two-week extra payment will be paid
Paid directly to your account The money will be paid to your landlord in line with the usual Housing Benefit payment cycle.
Paid directly to your landlord You will need to attend interviews with a work coach to discuss plans for a return to work in the future.
Paid directly to your landlord (But you have moved address) You will receive the extra two-weeks money directly to your account.
Paid directly to your landlord (But you have rent arrears) The money will be paid to your landlord in line with the usual Housing Benefit payment cycle. You should contact your landlord and discuss how to use the two weeks extra pay to help reduce your rental arrears.
Paid directly to your landlord (and you don’t have rent arrears) The money will be paid to your landlord in line with the usual Housing Benefit payment cycle. You should contact your landlord and ask for the extra payments to be transferred to you, or be used to reduce your rent the following month.
Deductions If your council was deducting money from your Housing Benefit, the deductions will also be taken from the two-week extra payment.

Universal Credit while in temporary or emergency housing

You will not be eligible to claim Universal Credit if:

  • You have been put in temporary accommodation because you're homeless.
  • You are living in supported or sheltered housing.
  • You are living in a hostel.

Instead, your housing costs will continue to be paid by Housing Benefit. Once you move out of temporary, supported or sheltered housing or a hostel, you will be asked to claim Universal Credit.

What are the differences between Housing Benefit and Universal Credit

Unlike Housing Benefit, Universal Credit is paid once a month. Your Universal Credit payment will include a housing costs element that will replace the help you currently get from Housing Benefit.

The money for your rent under Universal Credit will be paid directly to you as part of your monthly Universal Credit payment - it is then your responsibility to pay your rent.

If you have a mental health illness and you find it challenging to budget your money either you or your landlord can request you receive an Alternative Payment Arrangement. This would mean your landlord is paid directly, and you are paid more frequently.

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