Types of cost of living in Uk

The term “cost of living payment” in the UK is not a specific payment or allowance provided by the government or any particular entity. However, there are various benefits, allowances, and support systems in the UK that are designed to help individuals cover the costs associated with living, depending on their circumstances. Some examples include:

1. State Pension: The state pension is a regular payment from the government that individuals receive when they reach the state pension age. The amount depends on an individual’s National Insurance contributions.
2. Universal Credit: Universal Credit is a means-tested benefit in the UK that provides financial support to individuals and families on a low income or who are out of work. It includes different elements like a standard allowance, housing costs, and additional elements for children or disabilities.
3. Personal Independence Payment (PIP): PIP is a non-means-tested benefit for people with a long-term health condition or disability. It is intended to help with the extra costs of living with a disability.
4. Disability Living Allowance (DLA): DLA is a benefit for children under 16 who have difficulties walking or need significantly more help than other children of the same age.
5. Attendance Allowance: This is a benefit for individuals aged 65 or over who have a physical or mental disability and need help with personal care.
6. Carer’s Allowance: Carer’s Allowance is a benefit for people who spend at least 35 hours a week caring for someone with substantial care needs.

Low income benefits and tax credits Cost of Living Payment eligibility

• Eligibility for Cost of Living Payments: Individuals receiving specific low-income benefits or tax credits may qualify for up to three Cost of Living Payments, amounting to £301, £300, and £299.
• Qualifying Benefits and Tax Credits: The entitlement applies to recipients of the following benefits or tax credits on specific dates:
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Income Support
  • Pension Credit
  • Universal Credit
  • Child Tax Credit
  • Working Tax Credit
• Payment Details: The Cost of Living Payments, totaling £900, will be disbursed separately from regular benefit payments.
• Benefit Payment Dates: To be eligible for the Cost of Living Payments, individuals must be in receipt of the specified benefits or tax credits on the designated dates.
• Financial Support: This initiative aims to provide additional financial support to individuals with low incomes, recognizing the challenges posed by the cost of living.

Payment Eligibility Criteria for Cost of Living Payments:

£299 Cost of Living Payment:

• Individuals will not receive a payment if they solely receive New Style ESA, contributory ESA, or New Style JSA.
• For joint claims on qualifying dates, a single payment of £299 will be sent using the same method as between these dates, if eligible.

Eligibility for £299 Payment:

• Universal Credit: Eligible if entitled to Universal Credit for an assessment period ending between 13 November 2023 and 12 December 2023.
• Income-based JSA, income-related ESA, Income Support, and Pension Credit: Eligible if entitled to these payments for any day between 13 November 2023 and 12 December 2023, or entitled for any day within this period but did not receive a benefit payment ranging from 1 penny to 9 pence.
• Tax Credits: Eligible if received a payment for any day between 13 November 2023 and 12 December 2023, or later received a payment for any day in that period.

£300 Cost of Living Payment:

• Eligibility mirrors the criteria outlined for the £299 payment, with the assessment period for Universal Credit, income-based JSA, income-related ESA, Income Support, Pension Credit, and Tax Credits specified between 18 August 2023 and 17 September 2023.

£301 Cost of Living Payment:

• Similar eligibility criteria apply for the £301 payment, with the assessment period specified between 26 January 2023 and 25 February 2023 for Universal Credit, income-based JSA, income-related ESA, Income Support, Pension Credit, and Tax Credits.

These Cost of Living Payments aim to provide financial support to eligible individuals based on their entitlement to specific benefits or tax credits during designated assessment periods.

Ineligibility for Cost of Living Payment – DWP Benefits:

• You will not be eligible for the Cost of Living Payment if your DWP benefit is reduced to £0 during the qualifying period, commonly referred to as a ‘nil award.’

Reasons for Ineligibility:

• Reduction to £0 may occur if:
  • Multiple payments of earnings are received in your Universal Credit assessment period.
  • Either your or your partner’s earnings increase.
  • Either your or your partner’s savings increase.
  • Another benefit is initiated.
  • A ‘sanction’ is applied due to non-compliance with your claimant commitment.

Exceptions to Ineligibility:

• You may still be eligible for the Cost of Living Payment if your benefit is reduced to £0 under specific circumstances:
  • Deductions from your benefit for reasons such as rent payments to your landlord or outstanding debts.
  • Received a hardship payment due to inability to cover rent, heating, food, or hygiene needs.

Ineligibility for Cost of Living Payment – Tax Credits:

• You will not be eligible for the Cost of Living Payment if your tax credits entitlement for the tax year falls below £26.

Payment Scenarios for Cost of Living Payment:

1. Child Tax Credit and Working Tax Credit Recipients:
   • If you receive both Child Tax Credit and Working Tax Credit, you will only receive a Cost of Living Payment for Child Tax Credit, and it will be disbursed by HMRC.
2. Tax Credits from HMRC and DWP Low Income Benefit Recipients:
   • If you receive tax credits from HMRC and also a low-income benefit from DWP, you cannot receive a Cost of Living Payment from both HMRC and DWP. Generally, you will be paid by DWP only.
3. Timing and Payment Changes:
   • Your payment may be delayed if there are changes, such as being awarded a qualifying benefit at a later date or updating the account for benefit or tax credit payments. However, the Cost of Living Payment will still be automatically processed.
4. Repayment if Ineligible:
   • If you received a Cost of Living Payment but are later found to be ineligible, there may be a requirement to repay the amount.
5. Guidance Updates:
   • Periodic updates with payment dates will be provided in this guidance before the commencement of each payment cycle.

Disability Cost of Living Payment Eligibility:

• You may qualify for a Disability Cost of Living Payment amounting to £150 if you are currently receiving any of the following benefits:
  • Attendance Allowance
  • Constant Attendance Allowance
  • Disability Living Allowance for adults
  • Disability Living Allowance for children
  • Personal Independence Payment
  • Adult Disability Payment (in Scotland)
  • Child Disability Payment (in Scotland)
  • Armed Forces Independence Payment
  • War Pension Mobility Supplement
• To be eligible for the Disability Cost of Living Payment, you must have received a payment (or are later found to be entitled to a payment) of one of these benefits for the period 1 April 2023.
• If you were receiving a qualifying benefit from the Ministry of Defence and a qualifying benefit from DWP, you will receive the Disability Cost of Living Payment from DWP only.
• If you have received a Disability Cost of Living Payment but are later determined to be ineligible, there may be a requirement to repay the amount.
• Additional guidance on the Disability Cost of Living Payment is available in an easy-read format for accessibility.

Payment Dates for Disability Cost of Living Payment:

• Automatic Payments:
  • The majority of individuals received the £150 Disability Cost of Living Payment automatically.
  • Automatic payments were processed between 20 June 2023 and 4 July 2023.
• Priority Order:
  • Payments were prioritized for individuals receiving a qualifying disability benefit from DWP before those receiving a qualifying benefit from the Ministry of Defence.
• Delayed Payments:
  • Some individuals may experience delayed payments, especially if there are changes such as being awarded a qualifying benefit at a later date or updating the account for benefit payments.
  • Despite any delays, eligible recipients will still receive the Cost of Living Payment automatically.

These details provide an overview of the payment process for the Disability Cost of Living Payment, including the timeline for automatic payments and considerations for delayed disbursements.

Pensioner Cost of Living Payment:

• If you qualify for a Winter Fuel Payment for winter 2023 to 2024, you will receive an additional £150 or £300 as part of your regular payment starting from November 2023.
• The total Winter Fuel Payment, inclusive of the Pensioner Cost of Living Payment, varies based on your birthdate and circumstances during the qualifying period.
• Individuals born before 25 September 1957 are eligible to receive a Winter Fuel Payment for winter 2023 to 2024.
• In October or November, you will receive a letter specifying the amount of the Winter Fuel Payment, including details about the Pensioner Cost of Living Payment, if you meet the eligibility criteria.

Reporting a Missing Cost of Living Payment:

• Payment Confirmation:
  • Most individuals should have received their £301 and £300 Cost of Living Payments, as well as the £150 Disability Cost of Living Payment for 2023.
• Reporting Missing Payments:
  • If you believe you should have received one of the following payments but cannot find it in your bank, building society, or credit union account, you can report a missing Cost of Living Payment.
• Payments to Report:
  • £301 paid between 25 April 2023 and 17 May 2023 for most individuals.
  • £300 paid between 31 October and 19 November 2023 for most individuals.
  • £150 Disability Cost of Living Payment paid between 20 June 2023 and 4 July 2023 for most individuals.
• Upcoming Payment:
  • The £299 Cost of Living Payment for a low-income benefit will be paid between 6 February and 22 February 2024 for most individuals. Reporting it as missing will be possible from 23 February 2024.
• Procedure:
  • Find out how to report a missing Cost of Living Payment through the appropriate channels if you have not received the expected payments in your account.