Brits on tax credits to get £500 one-off benefits payment, Rishi Sunak reveals in the Budget

BRITS who claim Working Tax Credits will get a one-off payment worth £500, Chancellor Rishi Sunak confirmed in today’s budget.

The move echoes the extension to the £20 uplift in Universal Credit payments, designed to help with the ongoing affects the pandemic.

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The Chancellor said that because of the way that the Working Tax Credits system works, people will not be able to get the extra weekly £20.

Instead, everyone who gets the benefit will get a £500 one-off payment.

This is what happened last year, when working credit claimants received a one-off lump sum of £1,040.

This was just one of several big changes announced in today’s budget.

The chancellor confirmed:

Mr Sunak said: “To support low-income households, the Universal Credit uplift of £20 a week will continue for a further six months, well beyond the end of this national lockdown

“We’ll provide Working Tax Credit claimants with equivalent support for the next six months.

“Because of the way that system works operationally, we’ll need to do so with a one-off payment of £500.”

The government has confirmed that Working Tax Credit claimants will each receive £500Credit: PA:Press Association

Lots of people have been switched from Tax Credits to the newer Universal Credit system, which means they would already be getting the uplifts.

New benefits claimants are usually added to Universal Credit rather than Working Tax Credit – unless they are eligible for the severe disability premium.

But there are also plenty of people who are still on the old-style system, and the final deadline for being moved across has been pushed back to 2024.

Anyone who hasn’t yet been transferred across will now be eligible for this new one-off payment.

The lump sum will be paid automatically so you don’t need to do anything to get it.

You should receive it by mid-April via the same method that you usually get your tax credits paid.

If the payment doesn’t arrive by the end of April, you can ask for help via the Treasury customer services helpline.

How much does someone on Working Tax Credit receive?

WITH Working Tax Credits you are entitled to a basic amount worth up to £3,040 per year, and you might get extras on top.

The extra elements include:

A couple applying together: up to £2,045 a year
A single parent: up to £2,045 a year
Working at least 30 hours a week: up to £825 a year
Disability: up to £3,220 a year
Severe disability: up to £1,390 a year (usually on top of the disability payment)
Paying for approved childcare: up to £122.50 (one child) or £210 (two or more children) a week

Under the new uplift, claimants will also a receive a one-off £500 payment on top of this.

The budget documents also confirm that the government will continue
to treat Working Tax Credit claimants who have been furloughed, or experienced a temporary reduction in their working hours, as working their normal hours.

This allows these claimants to remain eligible for Working Tax Credit rather than losing the benefit because the pandemic has impacted their earnings.

Other changes to the benefits system include a six-month extension of the Universal Credit uplift which will give people an extra £20 per week.

The government has also confirmed that it will continue the suspension of the Minimum Income Floor (MIF) for self-employed Universal Credit claimants until the end of July 2021.

The MIF will be gradually reintroduced from August, but DWP work coaches will be given discretion to not apply it on an individual basis where they assess that claimants’ earnings continue to be affected by COVID-19 restrictions.

DWP is also changing the way it reclaims money from Universal Credit allowances.

From April 2021, the period over which Universal Credit advances are recovered will increase to 24 months and the maximum rate at which deductions can be made will reduce from 30% to 25% of the standard allowance.

These measures were previously due to be implemented from October 2021.

From June, care leavers up to the age of 25 and those under the age of 25 who have spent at least three months in a homeless hostel will be exempt from the SAR in Universal Credit and Housing Benefit, helping more vulnerable people to access suitable housing.