How does it work?

Updated on 14 April 2018

Universal credit is a new monthly benefit that is gradually replacing income support, income based jobseeker’s allowance, income related employment and support allowance, housing benefit, child tax credit and working tax credit.

It is administered by the Department for Work and Pensions (DWP).

Universal credit is made up of different elements. You qualify for the different elements based on your household circumstances. All of the elements you qualify for are added together to find a maximum amount which is then reduced based on your income.

Universal credit includes a childcare element. If you meet the qualifying conditions and you have eligible childcare costs, you can include your childcare costs in your claim. This element is worth up to 85% of your childcare costs. The maximum you can claim is 85% of £760.42 per month for one child (£646.35) or £1303.57 (£1108.04) per month for two or more children.

Universal credit is paid monthly, usually into your bank account.

You can find out more about calculating a universal credit award on our website for advisers.