Universal Credit is a living support payment which is targeted towards helping those who are in financial need to meet everyday costs. It is issued every four weeks to eligible claimants, but those who are claiming for the first time are required to wait for five weeks. Universal Credit is slowly replacing six key benefits known as ‘legacy’ entitlements. These are Child Tax Credit, Working Tax Credit, Housing Benefit, Income Support, income-based Jobseeker’s Allowance and income-related Employment and Support Allowance.
If tax credits stop, however, there are two main options of financial support which can be received.
Universal Credit is available to those who are under the State Pension age, with Pension Credit at hand for those over this age.
The government has pledged to provide support and financial advice to those who are transitioning from tax credits to Universal Credit.
If there is a gap between one benefit ending and another beginning, claimants may consider applying for an advance on Universal Credit.
This is for those in difficult financial circumstances, and payments, if approved, can be made within three working days.
However, it is worth noting that future monthly payments will be reduced to repay the advance sum.
When transferring to Universal Credit, any tax credit debt will be moved to the Department for Work and Pensions (DWP).
The government website says this may also reduce Universal Credit payments in an effort to recover the debt.
Those who currently receive any one of the six legacy benefits do not currently have to take any action.
This is, unless, one of two circumstances apply to their personal situation.
These are if a person has had a change of circumstances which must be reported, or if the DWP contacts them about transitioning to Universal Credit.
Millions have claimed the universal benefit within the last weeks and months due to the severe financial implications of coronavirus.