Universal credit savings limits
Your universal credit (UC) payment can be affected by:
money, savings and investments
property you own but do not live in
This page is about money and savings.
More about property you own but do not live in.
Table: capital limits
This table shows how your UC payments can be affected by money, savings, investments and property. These things are sometimes called 'capital'.
| Amount | How it affects your monthly UC payment |
|---|---|
| Less than £6,000 | No effect on what you get |
| £6,000 to £16,000 | Your UC goes down |
| More than £16,000 | You cannot usually get UC |
Moving from tax credits to universal credit
You can have savings over £16,000 for up to a year if:
you have this when you claim UC
you move to UC after a migration notice
Your UC stops if you still have more than £16,000 in savings after a year.
These rules do not apply if you chose to move to UC before you got a migration notice.
Your monthly payment goes down if you have savings above £6,000.
Savings between £6,000 and £16,000
The Department for Work and Pensions (DWP) takes money off your monthly payment.
Your UC goes down by £4.35 for every £250 you have in savings between these amounts.
This shows as a deduction for money, savings and investments on your UC statement.
Check your online UC statements to make sure it's worked out right.
Example: how savings affect UC payments
Dinesh has £7,000 in a savings account.
The DWP takes £17.40 a month from his UC payment because of his savings.
His deduction is worked out like this:
STEP 1: £7,000 - £6,000 = £1,000 (the first £6,000 is always ignored)
STEP 2: £1,000 ÷ £250 = 4
STEP 3: 4 x £4.35 = £17.40
What counts as savings?
Savings can include most or all of your money. For example, money in:
cash
your main bank account
other bank accounts or savings accounts
building society, post office or credit union accounts
ISAs or stocks and shares
premium bonds
PayPal or other online accounts
cryptocurrency
If you get UC as a couple, your partner's savings count too.
It counts as your money even if you are keeping it safe for a family member or friend.
When your wages count as savings
Wages count as savings at the end of the next assessment period after you get them.
You have to report any changes in savings to the DWP.
Example: when wages become savings
Lucy's assessment period is 13 September to 12 October.
She gets her salary of £2,000 on 15 September.
Lucy has to tell the DWP about any of her salary she has not spent by the end of her next assessment period - so by 12 November.
This counts as savings in her assessment period that runs from 13 November to 12 December.
It only affects her UC if her savings go above £6,000 but she should still report it.
What does not count as savings?
Some things do not count or are ignored. For example:
the value of a pension fund or life insurance policy
money in children's bank accounts or child trust funds
personal items like your car, furniture, gold or jewellery
Spending your savings
Be careful how you spend savings when you're on UC.
You can use your savings:
to pay off or reduce your debts
for reasonable spending in your situation
If you spend or give money away so you can claim benefits or get a higher monthly payment, the DWP could either:
refuse your UC claim
work out your UC as if you still had the savings
They might do this even if getting benefits was not the main reason you spent or gave away money.
Reporting changes to the DWP
You are asked about your savings and investments when you first apply for UC.
You must report any changes during your claim. For example:
inheritance money
divorce settlements
redundancy payments
compensation payments
lump sums from a pension or life insurance policy
If you do not report a change it could lead to:
an overpayment or underpayment
a fraud investigation or penalty
See GOV.UK - Universal credit: Money, savings and investments.
If you disagree with a DWP decision
You can ask the DWP to look at any decision about your benefit again. This is called a 'mandatory reconsideration'.
Need more advice?
Last updated: 20 December 2024
