Universal Credit and furlough rules: How much benefit you are entitled to while furloughed
On March 23, Prime Minister Boris Johnson announced the UK would be placed into lockdown, meaning Britons are only permitted to leave their house for essential reasons. These include for one form of exercise a day, vital shopping, medical needs or travelling to and from essential work. As a result, many businesses have been forced to close, meaning some employees have been let go, or placed on furlough, with many Britons also applying for Universal Credit.
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The Coronavirus Job Retention Scheme (CJRS), established by the government, allows businesses to place their workers on unpaid leave.
Meanwhile, the Treasury pays 80 percent of employees’ salary, up to £2,500 per month.
Many have, however, been forced to turn to Universal Credit for a number of reasons.
Britons are eligible for CJRS if they were on the company payroll on or before February 28, and if not, Universal Credit is the most suitable option.
However, those who are furloughed could also be entitled to the living cost benefit.
The government website states that if salaries are reduced as a result of furlough changes, Britons could be “eligible for support through the welfare system, including Universal Credit”.
For those on a low income, whether furloughed or out of work, Universal Credit is available, as well as other benefits which could help.
Due to the start of the new tax year, and the effects of COVID-19, the government has increased the standard allowance in Universal Credit for one year.
Alongside Working Tax Credit, the allowance will increase by £20 per week on top of the annual uprating.
This applies to all new and existing Universal Credit claimants.
Universal Credit is comprised of a standard allowance alongside extra amounts dependent on personal circumstances, such as children or disability.
The government website provides a benefits calculator to assist people work out how much they could receive.
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However, the government website does provide an outline of standard allowances for certain groups.
Over 25 year olds who are single have a monthly allowance of £409.89.
For those in a couple where either are 25 or over, the couple is entitled to £594.04.
The first payment of Universal Credit usually takes five weeks to be processed – but campaigners have asked for this wait time to be reduced to help those in need during the coronavirus crisis.
However, for those in desperate need, claimants can apply for an advance on this payment.
The rapid increase in demand for the service has led to complaints of extended wait times.
Some have reported waiting hours on the phone to make a claim, or waiting in a queue to access the website.
The Department for Work and Pensions (DWP) has advised people to use the online claim form to apply for Universal Credit.
In the wake of the coronavirus crisis, the government plans to review the Universal Credit system.
Michael Gove, the Chancellor of the Duchy of Lancaster, said: “I think we have to consider the nature of the system and whether or not we do need to ensure that we better support the vulnerable.
“We keep that constantly under review and I think it’s important that we do recognise that it’s a very, very difficult economic time for very many.”
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