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Universal Credit – What do employers need to do?

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UC replaces six existing benefits;

  • Income-based Jobseeker’s Allowance
  • Income-related Employment and Support Allowance
  • Income Support
  • Working Tax Credit
  • Child Tax Credit
  • Housing Benefit

with a simpler, single monthly payment for people out of work or on a low income. It is delivered by the Department for Work and Pensions (DWP) and ends the 16 hour rule that may previously have led employees to restrict the hours they work to avoid losing benefits.

The benefit has been tested already and the progressive national rollout begins in October 2013.

UC payments are linked to how much money an employed Universal Credit claimant has earned. This is captured through the new way of reporting PAYE information in real time.

What do employers need to do?
Your employee’s UC payments are linked to PAYE information reported in real time, so:
• it is very important to make accurate real time submissions when they are due, so that the amount of UC employees receive can be calculated correctly
• getting the right identity details for new employees at the point of hiring is vital in helping with both PAYE and UC.

david@graceaccountants.co.uk


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