PLEASE NOTE THIS INFORMATION IS CORRECT AT TIME OF UPDATE, BUT CAN BE SUBJECT TO CHANGE AT ANY TIME
The government are making a number of changes to benefits and tax credits for people with children. One of these is to remove the extra amount of £17.45, given to people with children, which is known as the 'family premium'.
This change will affect the following benefits:
In Housing Benefit the family premium will be abolished for new claims or new births on or after 1st May 2016.
In Council Tax Support/Reduction it is up to each local authority to decide whether to abolish the family premium for new claims or new births. Those councils that are abolishing the premium will do so from April 2016.
This change will affect you if you:
- are making a new claim for these benefits, have one or more children and have some income or earnings coming in.
- If you are already claiming one of these benefits, have some income or earnings, and your first child is due after the family premium is abolished, you will also be affected because of the new births rule.
- If you are already claiming one of these benefits and have a child you will keep the family premium.
- However, you may be affected if you need to make a new claim in the future, for example, if you move to a property which falls outside your current local authority area.
The benefit cap will lower to £20,000 per year for couples and lone parents; and £13,400 per year for single people;
- How will this affect me?
- If your income in benefits/tax credits is over £384.61 per week (£1,666 per month) if you are part of a couple or a lone parent, then it will be reduced to this amount, if you are single then your total benefits/tax credits are more than £257.69 per week (£1,116.66 per month), then it will reduce to this amount.
- Benefits included are:
- Bereavement Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance (unless you get the ‘support’ component)
- Housing Benefit
- Incapacity Benefit
- Income Support
- Jobseeker’s Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widows Pension if you started getting it before 9 April 2001)
- Universal Credit (unless you’ve had a work capability assessment and aren’t fit for work)
- Benefits that are not included:
- You are not affected by the cap if anyone in your household qualifies forWorking Tax Credit or gets any of the following benefits:
- Armed Forces Compensation Scheme
- Armed Forces Independence Payment
- Attendance Allowance
- Disability Living Allowance (DLA)
- Employment and Support Allowance (if you get the support component)
- Industrial Injuries Benefits (and equivalent payments as part of a War Disablement Pension or the Armed Forces Compensation Scheme)
- Personal Independence Payment (PIP)
- Universal Credit payment for ‘limited capability for work and work-related activity’
- War pensions
- War Widow’s or War Widower’s Pension
- The child element of child tax credits and universal credit will be restricted to two children per household, for Child tax credit this will only apply for any children born after April 2017, for Universal Credits this will apply for all new claimants.
- How will this affect me?
- If you currently have child tax credits for more than two children and receiving child tax credits for these children this will not change, but if you have a child after April 2017 you will not get any further child tax credits for that child;
- If you are a new claimant to Universal Credit from April 2017 you will only be able to claim the child element of UC for two children, unless the you received the child element previously within the six months of your new claim.
- If the third child is disabled and in receipt of Disability Living Allowance a reduced child element will be paid.
- The Work Related Activity Component of ESA will be abolished and the Limited Capability Element of UC will be abolished from April 2017, but there will be transitional protection for those currently receiving these.
Bereavement Support Payment
- The current system of bereavement benefits, including Bereavement Payment, Bereavement Allowance and Widowed Parent’s Allowance, will be replaced with a new single Bereavement Support Payment. This will be introduced for new claims from April 2017.
- This simplified system will focus support on the 12 month period immediately following the bereavement in a bid to cover the additional costs of bereavement - this is a big departure especially in terms of Widowed Parent's Allowance which is currently paid until your youngest child leaves education. Age will no longer be a factor in determining eligibility and National Insurance contribution conditions will be simplified in a bid to make entitlement easier to understand. In the current system, bereavement benefits are taken into account when calculating entitlement to means tested benefits and Bereavement Allowance and Widowed Parent's Allowance are both included within the Benefit Cap. Bereavement Support Payment on the other hand will not affect Universal Credit entitlement and will not be included within the Benefit Cap.
- 30 hours of free child care from September 2017