1. What is ESA?
You can get ESA if your ability to work is limited by ill health or disability. ESA has two parts, ‘contributory ESA’ and ‘income-related ESA’. You may receive either one of these, or both together, depending on your circumstances.
You need to have paid enough national insurance contributions in certain tax years to be entitled to contributory ESA. Contributory ESA is a flat-rate benefit. It is not affected by any savings or other income you have, except for occupational or personal pensions. Unless you are put in the ‘support group’ (see section 3 below), payment of contributory ESA will be limited to 12 months. See section 8 below for more on the time limit.
Income-related ESA is a means-tested benefit. Your needs (and those of your partner, if you have one) are compared with the money you have, such as your income and savings. Income-related ESA is worked out from this. It can be paid on its own (if you are not entitled to contributory ESA) or as a top-up to contributory ESA (if you are). Income-related ESA can include amounts to help towards mortgage interest payments and some other housing costs.
Unlike contributory ESA, income-related ESA is not time limited.
You cannot get income-related ESA if your (and your partner’s) capital or savings are over £16,000.
Universal credit will replace income-related ESA over the next few years.