How your earnings affect your payments
If you’re employed, how much Universal Credit you get will depend on your earnings. Your Universal Credit payment will reduce gradually as you earn more - for every £1 you earn your payment reduces by 63p.
There’s no limit to how many hours you can work.
Use a benefits calculator to see how increasing your hours or starting a new job could affect what you get.
The work allowance
You can earn a certain amount before your Universal Credit is reduced if you or your partner are either:
- responsible for a child or young person
- living with a disability or health condition that affects your ability to work
This is called a ‘work allowance’. Your work allowance is lower if you get help with housing costs.
|Your circumstances||Monthly work allowance|
|You get help with housing costs||£198|
|You do not get help with housing costs||£409|
You have a child and get money for housing costs in your Universal Credit payment. You’re working and earn £500 during your assessment period.
Your work allowance is £198. This means you can earn £198 without any money being deducted.
For every £1 of the remaining £302 you get, 63p is taken from your Universal Credit payment. So £302 x £0.63 = £190.26.
This means you earn £500 and £190.26 is deducted from your Universal Credit.
If your payment stops because your earnings increased
As your income increases, your payment will reduce until you’re earning enough to no longer claim Universal Credit. Your payment will then be stopped. You’ll be told when this happens.
If your earnings decrease after this and you want to restart your Universal Credit payment, you’ll need to make a new Universal Credit claim online. You do this by signing in to your account.
If you do not have an online account, call the Universal Credit helpline. You’ll be told if you can claim again.
Universal Credit helpline
Telephone: 0800 328 5644
Welsh language (make a claim): 0800 012 1888
Textphone: 0800 328 1344
Monday to Friday, 8am to 6pm
Find out about call charges
If your monthly earnings are more than £2,500 over the amount where your payment stopped, this becomes ‘surplus earnings’.
Your surplus earnings will be carried forward to the following month, where they count towards your earnings. If your earnings (including your surplus earnings) are then still over the amount where your payment stops, you will not get a Universal Credit payment.
If your earnings fall below the amount where your payment stopped, your surplus will decrease. Once your surplus has gone, you’ll be able to get a Universal Credit payment again.
You’ll need to reclaim Universal Credit every month until your earnings have reduced enough to get another payment.
You can talk to your work coach for more information about surplus earnings.
If you have an online journal, the statement will show your work allowance and when the surplus reduces.
If you separate from your partner
If you’re part of a couple that claims Universal Credit together, any surplus earnings will be divided equally between you if you separate.
You’ll then need to re-apply individually, with your part of the surplus earnings counting towards your earnings.
If you’re a victim of domestic abuse you do not take on any surplus earnings from your partner. Talk to your work coach to make sure your partner’s surplus earnings are not divided between you.
If you’re self-employed
You can carry over a loss (as well as a surplus) to the following month. A loss will be deducted from your next month’s earnings.