What to do about universal credit (UC) deductions for debt

The Department for Work and Pensions (DWP) can take money from your universal credit (UC) each month for:

• benefit or tax credit overpayments

• advances and loans from the DWP

• rent and service charge arrears

• council tax, energy or water debts

• child maintenance

You can ask for smaller deductions from your UC if you're finding it hard to manage.

How much can be taken off for debts?

This depends on your age and if you claim as a single person or a couple.

Amounts in this table are rounded to the nearest pound.

Table: Maximum UC debt deductions from April 2023

You might also have deductions if other adults live with you and are expected to help you pay rent. These are a different type of deduction called housing costs contributions.

Benefit or tax credit overpayments

If the DWP think you have been overpaid benefits or tax credits they will write to you.

The letter should tell you:

• how much will be taken each month

• when deductions will start and end

Call DWP debt management on 0800 916 0647 if you cannot afford the deductions.

You can sometimes pay the benefits or tax credits back over a longer time. This means the deductions will be smaller each month.

StepChange has more advice on benefit or tax credit overpayments.

UC advances

You have 2 years to pay back a UC advance.

Ask the DWP to:

• pause repayments for up to 3 months if you cannot afford food or important bills

• extend the repayment time up to 2 years if you're paying the advance back over less time

Write a message like this in your UC journal:

You could also call the universal credit helpline on 0800 328 5644

Budgeting advances

You usually have 1 year to pay back a budgeting advance.

If you cannot afford food or important bills because of deductions you can ask the DWP to:

• pause repayments for up to 3 months

• extend the repayment time up to 18 months

Write a message like this in your UC journal:

You could also call the universal credit helpline on 0800 328 5644

Rent and service charge arrears

Your landlord can ask for deductions if you owe at least 2 months' rent or service charges.

This table shows the minimum and maximum amounts that can be taken to pay off these arrears. Amounts are rounded to the nearest pound.

Table: Monthly deductions for rent arrears from April 2023

Write a message like this in your UC journal:

If your only deductions are for rent arrears you could also call the universal credit helpline on 0800 328 5644

If you have other deductions as well, such as benefit or tax credit overpayments call DWP debt management on 0800 916 0647 instead.

Negotiate with your landlord

Ask your landlord if you can work out an affordable repayment plan for missed rent payments directly with them.

A debt adviser could help you negotiate.

If your landlord agrees to a plan they should tell the DWP to stop deductions for rent arrears.

Council tax, energy and water debts

These are sometimes called third party deductions because the money taken off your UC is given by the DWP to the council, energy or water company.

You could ask them if you can set up a more affordable repayment plan directly with them. 

If the council, energy or water company agree to this then they can tell the DWP to stop these deductions from your UC.

The DWP cannot make more than 3 deductions each month for third party debts.

Budgeting loans

You usually have 2 years to pay back a budgeting loan.

You can call DWP debt management on 0800 916 0647 if you're finding it hard to pay back.

Hardship payments

You can sometimes get hardship payments if you have a sanction while you're on UC.

Hardship payments are a type of DWP loan and have to be paid back.

The DWP might agree to reduce or cancel your UC deductions if, for example, you cannot afford food or to top up a prepayment meter.

The DWP should pause deductions for hardship payments if you start earning above a set amount. If you earn above this for 6 months these deductions should stop permanently.

Citizens Advice has more on paying back hardship payments.

Child maintenance

UC deductions for child maintenance are £36.40 a month.

The DWP should only make these deductions if:

• you are not working or self employed

• the Child Maintenance Service has told the DWP to make deductions

If you can agree an arrangement about child maintenance with your child's other parent then these deductions should stop.

Asking for a review of a UC decision

You can ask for a review if you think the:

• deductions should be lower

• DWP should not be making the deductions at all

The review is called a mandatory reconsideration.

Citizens Advice explain how to ask for a review. 

Struggling with debts?

Ask a debt adviser about breathing space.

Breathing space is a scheme that pauses payment demands while you get debt advice.

If you're on the scheme, the DWP must not make deductions for benefits overpayments or start new deductions for debts like:

• rent arrears

• council tax

• gas, electricity or water