FAQs: Backdated Pay and Universal Credit

If you receive Universal Credit the amount you get changes if your take-home pay changes.  This includes awards of backdated pay.  If you get additional pay within a Universal Credit assessment period (month), your Universal Credit payment will either be less than you normally receive or your income may be too high to qualify for a payment. 
Universal Credit is calculated on your personal circumstances.  Because of this we don’t know how individuals may be affected.   

Q) Will the back dated pay award affect my Universal Credit Claim? 

Yes.  If your earnings increase or decrease your Universal Credit payments will adjust automatically, this will include any lump sum received from back dated pay awards.  

Q) How will my Universal Credit Claim be affected?

The 2018/19 Local Government pay settlement was agreed on 1 February 2019 and is scheduled to be in place and paid, with a backdated award expected at the end of March.  This increase together with the backdated payment means you will either receive less Universal Credit than normal or you may even earn too much to qualify and your Universal Credit claim will close.  If your claim closes, you will see a message on your UC Journal telling you about this.

Q) How Do I Reclaim Universal Credit?

Log into your UC journal and select the “Reclaim” tab. You will find this at the bottom of the screen. This will take you to a new screen where you will be asked to answer a few simple questions. If you have any problems doing this, contact your Work Coach or visit your local Jobcentre Plus. 

You can access your UC Journal at www.gov.uk/sign-in-universal-credit

Q) Do I need to inform Universal Credit of my backdated pay award?

No, the Council’s payroll team supply Pay As You Earn (PAYE) information to HMRC on or before the day you are paid.  You may have seen this referred to as Real Time Information (RTI).

HMRC sends relevant data on Universal Credit claimants to DWP on a daily basis (4 times a day). This means the information supplied will be with DWP on the same day or on the next day, at the latest.

Q) What is a work allowance in Universal Credit?

If you and/or your partner are in paid work you may be able to earn a certain amount before your Universal Credit payment starts to be affected. This is called a Work Allowance.

There are 2 Work Allowance rates. Which one you get depends on whether your Universal Credit payment includes help with housing costs:

·       If you receive money to help with housing costs your Work Allowance will be £198 per month

·       If you do not receive money to help with housing costs your Work Allowance will be £409 per month

Q) I have a work allowance, how will the back dated pay award affect my Universal Credit?

For every £1 you earn above your Work Allowance, your Universal Credit payment will be reduced by 63p.

Q) I am still concerned how this is going to affect me.  Who can I turn to for help?

Angus Council’s Welfare Rights Service can provide further advice and assistance in this matter.  They offer a free, confidential and impartial service with issues related to welfare rights and money/debt advice. You can contact them by clicking this link:

https://www.angus.gov.uk/benefits_and_money_advice/help_with_benefits_andor_debts?item_id=21

An overview of Universal Credit can be found at  www.gov.uk/universal-credit