My UC has gone down in 2026 vs 2025, details in post.

worried33
worried33 Community Member Posts: 1,117 Championing
edited October 30 in Universal Credit (UC)

So the way my UC is calculated, the DWP add up all of my components, so single adult amount, LCWRA, housing costs, and TP.
If any of these increase, then the TP is reduced to compensate, so this has happed.

However the ESA deduction happens after the TP is recalculated, so if ESA increases, then the net UC payment is lower.

Before all panic sets in, I will be still on the same combined support as my ESA payments have gone up.

So what this means is over time, at least up until the TP has been eroded, the % of my support will gradually shift from UC to ESA.

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Comments

  • Anhedonia2
    Anhedonia2 Community Member Posts: 504 Empowering

    @worried33 Does that essentially just mean your income hasn't changed? Or have I missed something?

  • Darking
    Darking Community Member Posts: 83 Contributor

    I'm not an accountant or professional but here's my understanding

    The interaction between your Employment and Support Allowance (ESA) and Universal Credit (UC) depends primarily on whether you receive New Style ESA or Income-related ESA.

    If you have paid sufficient National Insurance contributions, you can claim New Style ESA alongside Universal Credit. However, New Style ESA is treated as unearned income for Universal Credit, meaning every pound you receive in ESA reduces your UC award by exactly one pound. Because of this direct offset, claiming both does not directly increase your overall monthly income compared to receiving UC alone. Despite this offset, claiming New Style ESA remains beneficial because it provides Class 1 National Insurance credits that count toward your State Pension, and payments are made fortnightly rather than monthly. Additionally, you only undergo a single Work Capability Assessment. If you are placed in the Support Group for ESA, you automatically receive the Limited Capability for Work and Work-Related Activity element in Universal Credit.

    If you were moved to Universal Credit via managed migration, you may receive a Transitional Protection element to prevent your overall entitlement from dropping at the point of transfer. DWP calculates your maximum UC entitlement including any Transitional Protection, but as standard UC elements increase over time, the Transitional Protection amount reduces accordingly. Furthermore, the ESA deduction is applied after the initial maximum UC award and Transitional Protection are calculated. Because ESA rates rise annually with inflation, a higher ESA payment leads to a larger deduction from your net UC payment. While the net payment from UC decreases, your total combined income remains stable because the increase in ESA compensates for the reduction in UC.

    In contrast, you cannot receive Income-related ESA and Universal Credit at the same time. Making a new claim for Universal Credit causes your Income-related ESA to stop completely, and it is impossible to return to it once the switch is made.

    I hope this is helpful

  • Kimi87
    Kimi87 Community Member Posts: 9,169 Championing

    Income Related ESA has now ended entirely and been replaced with UC.

  • Darking
    Darking Community Member Posts: 83 Contributor

    https://forum.scope.org.uk/discussion/comment/1157034#Comment_1157034

    Thank you, I missed that.

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