April 14, 2021

Coronavirus: ‘One click and we were worse off’ after universal credit claim

Some people applying for universal credit for the first time have found themselves worse off after losing their existing benefit payments.

The system means legacy benefits such as tax credits are stopped when someone applies for universal credit, even if the claim is ultimately rejected.

One applicant said his family was worse off “at the click of a button”.

Universal credit claims have soared amid the coronavirus outbreak, with the next figures published on Tuesday.

Savings trap
People who have seen a sudden drop in income, for a variety of reasons, can claim universal credit. In many cases this will leave them better off than they would otherwise have been.

However, some – commonly those with savings – may find they are ineligible for universal credit. Even so, existing benefit payments are stopped as soon as the application is made.

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