Are You Eligible?
Starting today, millions of people in the UK will begin receiving a tax-free cost of living payment of £299. However, there's an important loophole to be aware of that could prevent some individuals from getting this payment, even if they seem eligible.
Explaining the Loophole
We spoke to Halide Kalfaoglu, a benefits expert at Turn2us, to shed light on who may miss out on the cost of living payment and why. According to Halide, some individuals will not qualify for the payment if their benefit payment was reduced to £0 during the qualifying period, even if they are on benefits.
Who Is Eligible?
You may be entitled to the cost of living payment if you receive any of the following benefits or tax credits between November 13, 2023, and December 12, 2023:
- Universal Credit
- Pension Credit
- Income-based Jobseeker's Allowance
- Income-related Employment and Support Allowance
- Income Support
- Child Tax Credit
- Working Tax Credit
Exceptions to the Rule
There are a few exceptions to the rule. For example, if your entitlement was reduced to £0 for other reasons, such as paying rent or money owed, or if you received a hardship payment due to a sanction and couldn't cover basic needs like rent, heating, food, or hygiene. Additionally, if your tax credit entitlement for the tax year is below £26, you won't qualify for the cost of living payment.
What You Need to Know about Tax Credits
Tax Credits are a type of state benefit that come in two forms: Working Tax Credit and Child Tax Credit. Working Tax Credits are designed for individuals with a low income from work, while Child Tax Credits are for those with children, regardless of whether or not they work. You can claim one or both tax credits to help cover everyday essentials.
When and How Will the Payment Be Made?
The cost of living payment will be automatically credited to eligible individuals' bank accounts between February 6 and February 22, 2024. For tax credits-only claimants, the payment will be made slightly later, between February 16 and February 22, 2024. Look out for codes like "DWP COL" or "HMRC COLS" followed by your National Insurance number on your bank statement.
What to Do If You Don't Receive the Payment
If you believe you're entitled to the cost of living payment but don't receive it, you can report the missing payment online starting from February 23, 2024. The Department for Work and Pensions (DWP) is also urging low-income pensioners who aren't already receiving pension credit to check their eligibility. Claims can be backdated by up to three months, so it's important to submit a claim by March 5 to potentially receive the final cost of living payment.
Additional Support and Grants
If you don't qualify for the cost of living support payment, there are other avenues of support available. The Household Support Fund, worth £842 million, has been distributed among councils in England, who decide how to allocate the funds. You may also be eligible for a free grant from your energy provider if you're struggling to pay your energy bill. Use the free online calculators provided by Turn2us, Policy in Practice, or entitledto to find out what other benefits you might be eligible for.
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