The benefit cap

Last updated: 01/04/2021

The benefit cap is a limit on the total amount of benefit a household can be paid each year.

Benefits are not limited in households where:

  • Earnings from employment is above the value of 16 hours p/w at National Living Wage. This is £617 in 2021 – 2022.
  • Someone receives carer’s allowance, the carer’s element in universal credit or has an underlying entitlement to them,
  • Someone is in receipt of war widow or widowers’ pension, disability living allowance, personal independence payment, attendance allowance, industrial injuries benefits, guardian’s allowance, the support component of employment and support allowance or the limited capability for work- and work-related activity element of universal credit.

The limit has been set at £20,000 per annum (£1,667 per month) for a couple or single parent household and £13,400 per annum (£1,117 per month) for single claimants.

Benefits included in the cap are:-

  • bereavement allowance
  • child benefit
  • child tax credit
  • contribution-based employment and support allowance
  • jobseeker’s allowance
  • maternity allowance
  • universal credit
  • widowed parent’s allowance
  • widow’s benefit

All relevant benefits will be added up and any amount over the limit will be deducted from universal credit.

If you lose your job but have earned above the value of 16 hours p/w at National Living Wage in the previous 12 months, the cap will not affect you for the next nine months.