The Benefit Cap places a limit on the amount of benefit that people aged 16 to 64 can receive. The intention is that people should not receive more in benefit payments than the average wage paid to people in work.
The Benefit cap will apply to the combined income from the main out-of-work benefits, plus child benefit and child tax credits.
For a 12 week period starting from 7th November 2016, the Government started to apply a further reduction in benefits which will affect those already affected by the cap, as well as some customers for the first time.
Couples and lone parents will have their Benefit Cap reduced from £500 per week to £384 per week and single adults from £350 per week to £257 per week.
There are also new exclusions from the Benefit Cap:
The following benefits count towards the benefit cap:
The Benefit Cap will not apply to you, if you or your partner gets Working Tax Credit, if you are on Universal Credit earning £430 or more a month or you, your partner or anyone in your household who you are responsible for gets:
Carers Allowance and Guardian’s Allowance currently count towards the Benefit cap. Once the new changes take effect, if you, your partner or any children living with you get carers allowance or Guardian’s Allowance, the benefit cap will not apply to you.
The cap does not apply for 39 weeks if you have worked continuously for at least 12 months before work ended. The 39 weeks starts from the date the work ended.
To find out if the changes to the benefit cap will affect you, click here to use the benefit cap calculator
Here are some points to consider in preparation for the change:
Our Income Management team is also available to give further information and advice. Contact them on Freephone 0800 035 22 11 or 0300 303 8324 from a mobile.