Universal Credit UK: Some could get a bonus paid into bank account – are you eligible?

Universal Credit UK: Some could get a bonus paid into bank account – are you eligible?

With millions of households clearly having been affected by the coronavirus (COVID-19) crisis, saving money at the present time will likely not be a priority just now for many people. But, for some claimants of Universal Credit, the act of claiming the benefit will mean they are now able to access a scheme which offers them a 50 percent bonus on savings.

But, if setting aside money is something of a struggle in some months, savers can be reassured that they do not need to pay money in every month.

They can pay in as many times as they like, however there is a cap of £50 per calendar month.

So, if £50 has been saved in the account by August 4, then they wouldn’t be able to pay in any money again until September 1.

The money can only be withdrawn from the Help to Save account to the savers’ bank account.

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The Help to Save bonuses are paid at the end of the second and fourth years, with these being based on how much has been saved.

After four years, the account will close.

Help to Save: How much is bonus?

Savers are able to earn two tax-free bonuses over the four years, and they’ll get any bonuses they’ve earned even if the money is withdrawn.

The first bonus is received after the first two years, if the saver has used the account to save, that is.

This bonus will be 50 percent of the highest balance that has been saved.

Then, after four years, the saver will get a final bonus if they’ve continued to save.

This bonus will be 50 percent of the different betwen the two following amounts:

  • The highest balance saved in the first two years (years one and two)
  • The highest balance saved in the last two years (years three and four).

Should the highest balance not increase, the saver would not earn a final bonus.

With the most a person is able to pay into the account each calendar month being £50, a total of £2,400 can therefore be saved over four years.

As such, the most that can be earned from these particular savings in four years is £1,200 in bonus money – with this money being paid into the savers’ bank account – rather than their Help to Save account.

Even if a person stops claiming benefits, they can keep using the Help to Save account.

It is very important to be aware that saving money thjorugh a Help to Save account could affect a person’s eligiblity for certain benefits, as well as how much they get.

Help to Save: Who is eligible?

A person can open this account if any of the following apply:

  • They’re receiving Working Tax Credit
  • They’re entitled to Working Tax Credit and receiving Child Tax Credit
  • They’re claiming Universal Credit and their household earned £604.56 or more from paid work in their last monthly assessment period.

Additionally, savers need to be living in the UK.

That said, those who live overseas can apply for an account if they’re either a:

  • Crown servant or their spouse or civil partner
  • Member of the British armed forces or their spouse or civil partner.

Published at Wed, 10 Jun 2020 19:32:00 +0000