Universal credit and changes in circumstances

It is a claimant's responsibility to report changes of circumstances to DWP. A change will affect benefit from the first day of an assessment period.

This content applies to England

Reporting changes of circumstances

An applicant is expected to report a change of circumstances 'as soon as reasonably practicable' if:[1]

  • it might affect their entitlement to benefit, the amount of benefit, or its payment

  • they might reasonably be expected to know that there would be such an effect

Effect of changes of circumstances

Where a change in circumstances results in entitlement to UC increasing or decreasing, the change is applied at the beginning of an assessment period. Which assessment period is affected depends on the nature of the change.

Change in claimant circumstances

Where entitlement changes because of a change to the claimant's circumstances, universal credit is usually affected in the assessment period in which the change occurs.

There are some exceptions such as where an applicant becomes terminally ill or where DWP has decided to make or to stop making a hardship payment.[2]

However, where the applicant does not report the change until after the assessment period in which it occurred and it results in an increase in entitlement, the increase is only applied from the beginning of the assessment period in which the report is made unless an extension request is granted.[3]

This 'whole-month' approach can result in a claimant losing a significant amount of universal credit depending on when a 'disadvantageous' change of circumstances occurs in the assessment period. For example, if a claimant whose assessment period starts on the 5th of the month becomes entitled to less universal credit because their capital increases on the 30th of the same month, the reduction or removal of universal credit will apply from the 5th of that month, meaning reduced or no benefit for over three weeks of the assessment period.

Although not always possible, it is advisable to try and time such disadvantageous changes to fall as near as possible to the start of the assessment period.

Change in legislation

Where the change of circumstances is a change in the legislation, the new entitlement begins:[4]

  • on the date of the change if that is also the start date of the claimant's assessment period

  • on the first date of the next assessment period in other cases

Where the decision maker requires more information

Where a DWP decision maker requires more information in order to make a decision on how benefit is affected by an applicant's change in circumstances, they will notify the claimant and give a deadline for a response.[5]

Where a successful reconsideration would be to the applicant's advantage, there is a 14 day deadline for the applicant to respond with the requested information. In other cases, the deadline is one month.[6]

If the claimant does not respond within this time, a decision may be made taking into account only the information available when the request was made.[7]

Penalties for fraud or providing incorrect information

The DWP may decide to investigate a claim for universal credit where it suspects that a benefit offence may be, or has been committed.

The DWP has wide powers to require information from sources including landlords, employers, banks, childcare providers and credit reference agencies.[8] Where it is believed that a person has committed fraud, DWP may offer the option of paying a financial penalty rather than facing prosecution.[9] If they agree to repay, the amount can be recovered from benefits in the same way as an overpayment.

An applicant who is prosecuted or accepts a financial penalty in respect of fraud may also face sanctions to future benefits.[10]

A fixed civil penalty may be applied in some cases where a claimant has not acted fraudulently, but an overpayment has resulted because they have negligently given incorrect information to the DWP or has not given information requested or reported a change in circumstances without reasonable excuse.[11] The penalty will be added to, and recovered along with and by the same means as, the overpayment.

There is a right of appeal against the imposition of a civil penalty.[12]

Last updated: 19 March 2021

Footnotes

  • [1]

    reg 38(5) Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013 SI 2013/380.

  • [2]

    paras 20-31, Sch.1  Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [3]

    para 21, Sch.1, Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [4]

    para 32, Sch.1 Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [5]

    reg 33(2) and reg 33(3) Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [6]

    reg 33(3)(b) and reg 33(4 Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [7]

    reg 33(3)(c) Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381.

  • [8]

    s.109B Social Security Administration Act 1992 as amended by reg.2 Social Security (Persons Required to Provide Information) Regulations 2013 SI 2013/1510.

  • [9]

    s.115A and s.115A Social Security Administration Act 1992.

  • [10]

    s.6A(1), s.6B and s.7 Social Security Fraud Act 2001; Social Security (Loss of Benefit) Regulations 2001 SI 2001/4022. See also chap B2, ADM, DWP, 22 March 2013

  • [11]

    s.115C(1) and s.115D(1) and s.115D(2) Social Security Administration Act 1992.

  • [12]

    s.12 and Sch 2 and 3 Social Security Act 1998; reg 50(1) and Sch 2 Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 SI 2013/381