In an effort to support low-income households in the UK during the cost of living crisis, the government has announced a one-time payment of £650. This payment, which will be tax-free, aims to alleviate financial burdens and provide immediate assistance. The process for receiving the payment has been designed to be simple and efficient, with automatic deposits into recipients’ bank accounts.
Who is entitled to the £650 cost of living payment?
To qualify for the one-off £650 payment, individuals must meet the following criteria:
- Be already claiming the above benefits or tax credits on or before May 25th, 2022.
- Alternatively, if individuals have applied for means-tested benefits before the mentioned date, they may still receive the payment if their claim is successful.
- Claim one or more of the means-tested benefits or tax credits listed below:
- Child tax credit: A benefit provided to families with children to help with their living costs.
- Income-based jobseeker’s allowance: Financial support is available for individuals who are unemployed or work less than 16 hours a week.
- Income-related employment and support allowance: Assistance for individuals with a disability or health condition that affects their ability to work.
- Income support: Financial aid for individuals on low incomes, including those who are pregnant or have children.
- Pension credit: Support for pensioners with low incomes, helping them meet their basic needs.
- Universal credit: A benefit is in place to assist individuals on low incomes or those who are unemployed.
- Working tax credit: Financial assistance for individuals or families who work but have low incomes.
How will the £650 be paid?
The government aims to ensure a streamlined process for distributing the one-off payment. The following details outline key aspects of payment distribution:
- Automatic Payment: Recipients of the qualifying benefits will automatically receive the payment without the need to complete additional paperwork or forms.
- Bank Account Deposits: For convenience and speed, the payment will be directly deposited into the recipients’ bank accounts
- Two Payment Installments: Payments totaling £650 will be issued as two separate sums. The first payment is scheduled for July, and the second installment will follow later in the year. Recipients on tax credits may experience a slight delay in receiving their payment.
The UK government’s decision to provide a tax-free one-off payment of £650 to over 8 million low-income households aims to offer immediate financial support without complicating the process with bureaucratic procedures. By utilizing automatic deposits and focusing on qualifying means-tested benefits, the government intends to efficiently reach those who are most in need. This payment serves as a vital resource to alleviate financial burdens and assist low-income households during challenging times.
Disability cost of living payment
The £150 payment will go to those who are receiving disability benefits and will not affect any benefits that the recipient gets. It will be paid automatically, eliminating the need for application, and it is also open to those who are applying for benefits.
You will be eligible for this payment if you receive any of the following
- Disability Living Allowance
- Personal Independence Payment
- Attendance Allowance
- Scottish Disability Benefits
- Armed Forces Independence Payment
- Constant Attendance Allowance
- War Pension Mobility Supplement
It is possible to qualify for this and the £650 low income payment, and recipients would also receive the universal £400 payment, making a total of £1,200.