Up until the 1st February 2019, families who had three or more children could not claim Universal Credit (UC), but this restriction is no longer in place and this could be a big change for some people. This is because if you have a large family and have a change in circumstances; you may need to make a new claim for Universal Credit.
There are also some big changes to the total amount of benefits people can get and the number of children they can claim benefits for.
What are the new changes?
There are some restrictions in place which means if you already have two children and then have another child born after the 1st April 2017, you may not get any additional money for them in your UC award. This is known as the ‘two child limit’.
The extra amount for each additional child is £231.67 per month so for some people, it is important to be aware of this. You can still get Child Benefit for any additional children, but this is only £13.70 per week and that is the maximum you’ll get to support any additional children.
Children born before the 1st April 2017 are not affected, so if you already have three or more children born before this date, you will have the extra amount for each child added to your claim.
To find out more information about the two child limit including; how you can be exempt by going to: www.gov.uk/guidance/claiming-benefits-for-2-or-more-children
What does this mean for larger families?
Depending on the size of someone’s household, a larger family could have more benefits so they are more likely to be affected by the benefit cap. The benefit cap limits the amount of income a household can receive in benefits to £20,000 per year (this works out at £1666.67 per month or £384.62 per week).
There are lots of ways in which someone can be exempt from the benefit cap, some examples include if you get Universal Credit because you are a carer or have a disability or health condition that stops you from working. You may also be exempt if you, your partner or any of your children receive Disability Living Allowance or Personal Independence Payments.
In addition, if you work you will not be affected by the benefit cap. For example, if you or your partner earns £542 a month combined, after tax and national insurance contributions, then the cap won’t apply to you.
Universal Credit is designed to support people into work, and there is a lot of ways people are financially better off when working under UC than the previous benefits system. This includes more help with childcare costs, a lower benefit withdrawal rate and a more simplified system which is linked to your earnings so your monthly UC payment is automatically updated if your earnings go up or down.
You can find out more information about the benefit cap by going to www.gov.uk/benefit-cap