Benefit payments of £650 could be delayed for thousands of people

The news that the government would provide £650 in cost of living payments to help some struggling Britons was welcome news. However, it has been reported that thousands of people will have to wait months to receive the payments.

On Thursday May 26, Rishi Sunak announced a one-off £15billion relief package to arm the nation with a boost to help tackle rising energy bills. One of the most notable measures in the package was a £650 payment for low-income households. It is paid to people who receive means-tested benefits.

However, at the time of the announcement, exact details of how the payment would be made were sketchy. The payment will actually be paid in two instalments, Leicestershire Live reported.

READ MORE: DWP state pension increase to £1,000 set for 2023

As further details become clear, it is understood that the Department for Work and Pensions (DWP) will make the first payment of £325 from July. According to The Sun, the second of £325 will then be paid in the fall.

As energy bills are set to skyrocket again in the winter months, which could add a further £830 to annual household energy expenditure. However, thousands of people could see their payment delayed at a time when monthly and weekly budgets are very tight.

Recipients may wait longer for your payment if they get tax credits. Beneficiaries of tax credits will receive their first installment starting in the fall, and their second installment starting in the winter.

Since fall starts in September, that means you could be waiting two months for your payment if you get tax credits. Payment delay is in place to avoid “duplicate payments” if you claim more than one.

Classes of tax credits as a benefit inherited from the past. There are six such types of benefits which will be replaced by Universal Credit by the end of 2024. These benefits include In-work Tax Credit, Child Tax Credit, Jobseeker’s Allowance income-based employment (JSA), income support, income-related employment and employment. Support allowance (ESA), Housing allowance.

Those who receive tax credits alongside other inherited benefits – may already receive a cost of living payment because they receive this benefit. So the £650 payment to those on tax credits only will be distributed at a later date to avoid double payments.

Regarding the claim, you don’t have to do anything to get the £650 cost of living payment – it will be paid automatically. To get the first payment, you will need to have eligible benefits or have started a successful claim, which is later, starting May 25 this year. HMRC and DWP will set the eligibility date for the second payment in due course.

About Matthew R. Dailey

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