Income based benefits

Also known as ‘means-tested’, these benefits are for people who are looking for a job or are in lower paid work. This page gives an overview of the main benefit – Universal Credit and the benefits that will eventually be replaced by it. You may still be able to apply for these benefits individually, but you won't be able to claim them, and Universal Credit, at the same time.

Universal Credit

Universal Credit is being gradually rolled out across Great Britain and will eventually replace the existing benefits listed below for people aged 16 to 64. It may also be introduced from 2017 in Northern Ireland.

Young people aged 18 or over, who are not in full-time education, are eligible to apply and extra funds are available for people with a disability or health condition, childcare costs or caring responsibilities. This means parents, carers or partners could also apply.

Look at our Universal Credit factsheet.

Other benefits

Employment Support Allowance (ESA)

ESA helps people over the age of 16 whose health condition or disability affects their ability to work. There are two components of ESA, one of which is income-related, provided you meet the assessment criteria. You may get one or both of these components, depending on your circumstances. 

Look at our ESA factsheet.

Income Support (IS)

Income Support (IS) helps to cover basic living costs. You’ll need to meet the set criteria, such as working less than 16 hours a week. 

You’ll get a basic payment, usually paid every two weeks, and could also receive an extra payment or ‘premium’ if you’re disabled or a carer. Exactly how much will depend on your circumstances but if you qualify, it should be at least £57.90 per week.

Working Tax Credit

Once you are diagnosed with cancer, you can get Working Tax Credit on the basis that you are disabled, provided you: work at least 16 hours a week; your income is low enough; you get certain benefits because of your disability; and your disability puts you at a disadvantage in getting a job.

HM Revenue and Customs (HMRC) may ask you to give them the name of a healthcare professional who can confirm how your disability affects your chances of finding work. This might be a doctor or a community nurse.

Housing Benefit

If you are struggling to pay your rent, and you’re on a low income, you may be entitled to Housing Benefit. It can’t be paid for heating, hot water, energy or food, but you can look at our Managing money section for advice about how to save costs.

If you rent a room or a property from a private landlord, Local Housing Allowance (LHA) is used to work out how much Housing Benefit you will get. The amount you receive will depend on your circumstances.

Council Tax Reduction

If you live in Great Britain and are on a low income or not working at all, then you may be able to receive Council Tax Reduction. This could be up to 100 per cent reduction in your bill. 

In Northern Ireland, people on low incomes can apply for a reduction in their rates through the Rates Housing Benefit and Rate Relief schemes. 

If you are a student and you live in accommodation with other full-time students then you won't have to pay Council Tax.

Limits to what you can receive

There is a limit to the total amount you can receive from certain benefits if you are aged 16 to 64. This is called the benefit cap. 

Benefits related to your health, such as Disability Living Allowance (DLA) or Personal Independence Payment (PIP), are not included in this cap. Find out more at gov.uk

Another thing to be aware of is if your home is considered too big for you then you may have your housing benefit or Universal Credit cut. This is commonly known as ‘bedroom tax’. However, there are special circumstances where this will not affect you. For example, if you need a spare room because you can’t share due to being unwell or you need a carer to stay overnight. 

Where next?

Updated July 2017, next review due 2018.

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