Martin Lewis tells people who were rejected for Universal Credit to reapply

Martin Lewis is urging people who’ve been rejected for Universal Credit because they had too much in savings to check if they can reapply now.

Tens of thousands of households across the country have seen their finances hit by the coronavirus crisis – because of this, many have had to rely on their savings to get by.

If you’ve had to dip into your emergency stash, the MoneySavingExpert founder says you may now find yourself below the thresholds that make you eligible for Universal Credit.

The amount of money you’re entitled to through Universal Credit is reduced if you have more than £6,000 in savings – and if you have more than £16,000 put aside, you can’t claim anything at all.

Under the current eligibility rules, any capital or savings you have between £6,000 and £16,000 is treated as if you have a monthly income of £4.35 for each £250, or part of £250.

So – as explained by charity Turn2Us – if you have £6,300 in a savings account, £6,000 of it will be ignored and the other £300 will be treated as giving you a monthly income of £8.70.]

Writing in the latest MoneySavingExpert newsletter, Martin said: “If you’re eligible for Universal Credit, but you or your partner has £6,000+ in savings, your award is reduced. By £16,000+ you get nowt.

“This has impacted many during the pandemic, so they’ve used their savings. If so, the Govt has confirmed to us you can reapply/ask to be reassessed, based on the new lower savings amount.”

Who is eligible for Universal Credit and how do I apply?
Before you apply, you should first check if you’re actually entitled to Universal Credit at all.

You might be able to claim Universal Credit if:

You’re out of work or on a low income

You’re aged 18 or over (there are some exceptions if you’re 16 or 17)

You or your partner are under state pension age

You and your partner have less than £16,000 in savings

You live in the UK

If you think you’re entitled, you can apply for Universal Credit online via the Gov.uk website.

How much is Universal Credit?

Universal Credit can be extremely complicated to work out, as the amount you can claim can vary from month to month.

There is a standard allowance, which is the basic amount of Universal Credit you could get – this is dependent on your age and if you’re claiming as part of a couple.

The standard allowance is broken down is as follows:

For those single and aged under 25, the standard allowance is £344

For those single and aged 25 or over, the standard allowance is £411.51

For joint claimants both under 25, the standard allowance is £490.60

For joint claimants where one or both are 25 or over, the standard allowance is £596.58

After this, you may be entitled to additional extras, for example if you have children or cannot work due to a disability.

Once you’ve reached this total figure, you’ll then be subject to deductions based on how much you earn – and if you qualify for a work allowance – as well as any savings you have.

Department for Work and Pensions (DWP) bosses will look at your circumstances each month – known as your assessment period – to see how much you’re entitled to.

This means your Universal Credit allowance can fluctuate from month to month, if your earnings change regularly.

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