If the amount of Universal Credit you get changes, you’ll either get a letter or a message when you log into your Universal Credit online account. If you have an online account, you can also sign up for text or email alerts. Your Universal Credit might be reduced if:

• you’ve reported a change of circumstances that means you’ll get less – for example, you’ve moved home or you’re paying back an advance payment, hardship payment or budgeting advance
• you’ve been sanctioned – find out what to do if you’ve been sanctioned
• you’ve earned more from work – find out how working affects Universal Credit

You might also get less money if you’ve been paid too much Universal Credit or another benefit. This is called an ‘overpayment’. You’ll get less Universal Credit each month until you pay back the overpayment If you owe money, your creditor might be able to apply to have money taken from your payment – this is called a ‘third party deduction’. For example, if you haven’t paid a water bill, your water company might apply to take regular payments from your Universal Credit.

If you’ve had an overpayment

You’ll get less each month until you pay it back. In most cases, the Department for Work and Pensions (DWP) will reduce your payment by between 15% and 25% of your ‘standard allowance’ – this is the basic amount you get, not including extra amounts called ‘elements’. For example – if your payment is reduced by 15% of your standard allowance and your standard allowance is usually £334.91 a month, your total payment will be reduced by £50.24. Your payment can also be reduced if your overpayment happened because of fraud. The DWP won’t usually take more than 25% of your standard allowance. If you think you won’t have enough money to live on because you’re paying back an overpayment, you should talk to an adviser. They can help you budget or ask the DWP to either take repayments at a lower rate or stop taking repayments at all.

If your Universal Credit is reduced to pay off your debts

You’ll only get a deduction if the creditor asks the DWP – this is called a ‘third party deduction’. It’s usually 5% of your basic standard allowance but could be more. The DWP will tell you if this has happened – they’ll do this either in your online journal if you have one, or by letter. Deductions can only be made for:

• rent arrears and other housing costs like service charges – the deduction can be between 10% and 20% for rent arrears
• gas, electric or water arrears
• council tax bills arrears
• child support maintenance
• some loans
• some fines

Your Universal Credit will be reduced by 5% of your basic ‘standard allowance’ for most third party deductions – more money can be taken for some debts. For example, for rent arrears. You’ll never get more than 3 third party deductions at a time and in most cases no more than 25% of your standard allowance can be taken. Contact us if you think you won’t have enough money to live on. An adviser can help you budget and ask the DWP to change their decision or make an appeal if suitable. For example, you might be able to appeal how much they’re taking off your Universal Credit for rent arrears.

If you don’t have enough to live on

You can ask for a smaller deduction if the amount your Universal Credit is being reduced means you don’t have enough money to live on. You might have Universal Credit deduction for:

• a benefit debt
• a Social Fund loan
• rent arrears

You’ll need to show the DWP that you don’t have enough to live on – this is called financial hardship. You’ll need to give them a financial statement showing your income and what you spend your money on. You’ll also need to show you can’t meet your basic living costs with the current rate of deduction. You can send this information through your online journal or in a letter if you don’t have an online account.

If you think your payment is wrong

You should call the Universal Credit helpline or ask for an explanation using your online account if you have one. You should do this if:

• your payment is less than you expected and you haven’t been told why
• you think there’s been a mistake with how your Universal Credit has been worked out

Provide any evidence you have

It’s a good idea to give them some evidence of the mistake if you can. You’ll need to do this through your online account if you have one, or by letter. Evidence could be, for example:

• your tenancy agreement – if you think your housing costs are wrong
• payslips or bank statements – if there’s been an error in your earnings (ask your employer for payslips if you don’t have them)
• childcare bills – if they have your childcare costs wrong

If you still disagree with the deduction

If the DWP give you an explanation and you still disagree with the decision, you can challenge it – this is known as a mandatory reconsideration.