The UK government is finalising its shift from legacy benefits—including Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance (JSA), and Income Support—towards a unified Universal Credit (UC) system. This transition aims to simplify welfare payments and reduce administrative costs, affecting around 500,000 households still receiving these older benefits. Here’s what you need to understand about the change, updated payment levels, and what actions to take.
DWP Announces Cuts to 4 Benefits
| Key Details | Information |
|---|---|
| Benefits being phased out | Working Tax Credit, Child Tax Credit, JSA, Income Support |
| New system | Universal Credit |
| Final payment update | April 2025 |
| Migration start | April 2025 onwards |
| Action required | Apply for Universal Credit before legacy benefits are cancelled |
| Official DWP Universal Credit info | Visit GOV.UK Universal Credit |
Major Changes in the Welfare System
Why the Transition Is Happening
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The goal is to simplify benefits by rolling them into one monthly payment.
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It reduces complexity and the cost of administration.
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UC covers a broader range of circumstances under one application process.
Who Is Affected
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Anyone still receiving:
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Working Tax Credit
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Child Tax Credit
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Jobseeker’s Allowance (income-based)
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Income Support
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Updated Tax Credit Payments Before Final Phase-Out
To ensure continued support during the transition, HMRC has announced increased tax credit rates for the final year before cancellation.
Working Tax Credit Updates
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Basic Element: £2,435 (up from £2,280)
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Couple and Lone Parent Element: £2,500 (up from £2,340)
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Disabled Worker Element: £3,935 (up from £3,685)
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Severe Disability Element: £1,705 (up from £1,595)
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Childcare Costs: £175 (one child), £300 (two or more children)
Child Tax Credit Updates
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Family Element: £545 (unchanged)
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Child Element: £3,455 (up from £3,235)
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Disabled Child Rate: £4,170 (up from £3,905)
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Severely Disabled Child Rate: £1,680 (up from £1,575)
These will be the final updates to tax credits before they are fully phased out.
Universal Credit Migration Timeline
Key Dates for Migration
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April 2025: Income Support and Tax Credit claimants with Housing Benefit receive migration notices.
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May 2025: JSA recipients begin their transition.
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June 2025: Housing Benefit-only claimants transition.
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July 2025: ESA claimants with Child Tax Credits are notified.
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May 2025 onwards: Tax credit claimants over State Pension age will be advised on UC or Pension Credit.
Support for Affected Households
What Help Is Available
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Guidance on how to apply for UC
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Helplines and support centres for questions or difficulties
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Feedback-led adjustments to the process
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Commitment from DWP to avoid disruption of support
Employment Minister Jo Churchill confirmed that while the process has gone well so far, the government will continue adjusting based on public feedback to improve user experience.
Implications and What to Do
Key Takeaways
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This is a mandatory transition. Inaction may lead to benefit cancellations.
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If you’re affected, apply for Universal Credit as soon as you receive your notice.
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Review eligibility for additional UC elements such as housing, disability, or childcare support.
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Delays in applying can risk temporary or permanent loss of financial support.
FAQs
What happens if I don’t switch to Universal Credit in time?
Your legacy benefit payments may be stopped, and you could face a gap in support.
Do I need to do anything now?
Not until you receive your migration notice. Once you do, apply promptly.
Can I get help with my Universal Credit application?
Yes. The DWP offers various support channels, including phone lines and in-person help.
Will I get less money on Universal Credit?
This depends on your circumstances. Some may receive more, others less. A transitional protection payment may apply in some cases.
When will all legacy benefits be fully cancelled?
The goal is to complete the transition by the end of the 2025–26 financial year.
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