What benefits are included?

On Universal Credit, the benefits that count towards the benefit cap are:

• Universal Credit (excluding the childcare element)

• Child Benefit

• Maternity Allowance

• Bereavement Allowance

• Employment and Support Allowance (unless you are in the Support Group)

• ​Incapacity Benefit

• Jobseeker’s Allowance

• Severe Disablement Allowance

• Widowed Parent’s Allowance (including widowed mother’s allowance and widow’s pension)

If you are receiving Universal Credit and receiving Housing Benefit separately from your local authority for temporary accommodation, this is not included in the benefit cap.

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How to remove the benefit cap / benefit cap exemptions

The benefit cap won't apply in the following situations:

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• Your total income from benefits is less than your benefit cap amount

Don't forget to include child benefit when calculating your total benefits

• You earn more than £793 (£722, if prior to 8/4/24)

The benefit cap won't apply if you claim Universal Credit and earn at least £793 in an assessment period. If you are part of a joint claim, they will look at your combined earnings.

• You're in a grace period

• You or your partner get any of the following benefits:

  • Attendance allowance (AA)​

  • Disability Living Allowance (DLA)

  • Personal Independence Payment (PIP)

  • Carer's Allowance (CA) or Guardian's Allowance

  • Employment and Support Allowance (ESA) - support component

  • Universal Credit - Carer element or Limited Capability for Work-Related Activity element (LCWRA)

• Your child or qualifying young person gets:​

  • Disability Living Allowance (DLA)​

  • Personal Independence Payment (PIP)

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The 'grace period'

You may qualify for a 9 month grace period from the benefit cap if you, your partner or your ex-partner earned at least £793 a month, every month, for the past 12 months (or £722 for months before April 2024). When you first claim or if your earnings drop below £793 Universal Credit will ask you your past 12 months earnings to determine exemption from the benefit cap.

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NOTE:

• If you are relying on earnings from an ex-partner to qualify you must have been living as a couple during that period of work to qualify. 

• If you were working and receiving Universal Credit, the grace period starts on the first day of the assessment period in which your earnings fell below £793.

• If you split from a partner during a grace period the remainder of the grace period is applied to both of you.

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Key information and other FAQs

• The benefit cap is not the same thing as the 2 child cap.

• The benefit cap on Universal Credit has entirely different rules to people on Housing Benefit. If you are reading information about the benefit cap and it says anything about "39 weeks" or "50 in 52 weeks" then this only relates to Housing Benefit, Universal Credit do not use the same rules.

• It is possible to be benefit capped without claiming housing element.

• It is possible for someone to benefit capped by more than their housing element.

• The benefit cap does not apply and is not relevant as long as you earn above £793 in an assessment period. 

• Working 16 hours does not always guarantee that you will have enough earnings to remove the benefit cap. It depends on how often you are paid.

• It may say on your statement that the grace period will apply from a certain month. It says this even if you do not receive enough in benefits to be benefit capped or if you are exempt.

• Occasionally Universal Credit can miss applying the benefit cap on your first payment. If this happens and you're not capped when you should have been, Universal Credit will issue an overpayment letter and recover the overpayment as debt.

• If you are benefit capped and struggling, the Jobcentre can offer you extra support through providing additional work-related appointments, referrals for budgeting support and employment support to help you find work. Do remember that you may be eligible for help with up to 85% of childcare costs if you start paid work and earning £793 a month will lift the benefit cap. If you're struggling to pay your rent you can apply to your local authority for Discretionary Housing Payment (DHP).

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