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Millions of households across the UK are to benefit from a one-off government payment of £650 to help with the rising cost of living.

The payment aims to support almost eight million vulnerable households across the UK as part of a £15 billion support package.

How do the payments work?

The Government announced that the payment would be issued directly to households on means-tested benefits in two lump sums. The first was paid in July, while the second payment will follow in the Autumn.

The government said that the payment would be tax-free, would not affect the benefit cap and would not affect existing benefit awards.

Who will receive the payments?

The £650 cost of living payment is being made in two lump sums and to be eligible, people must be on one of the following means-tested benefits:

  • Universal Credit
  • Working Tax Credit
  • Child Tax Credit
  • Pension Credit
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Income support

When can households expect the next £324 cost of living payment?

To receive the first £326 instalment of the payment, claimants must have been entitled to receive a benefit payment or tax credits between April 26, 2022 and May 25, 2022, and most would have already received this.

Those who claim Universal Credit, Income-related Employment Support Allowance, Income-based Jobseeker’s Allowance, Income Support and Pension Credit, would have seen the first instalment hit bank accounts between July 14 to July 31.

While households on Tax Credits should have seen the first instalment of £326 hit accounts earlier this month from September 2 to September 7.

The second £324 instalment is due to be paid over the coming months. No exact dates have yet been confirmed.

What if I have a disability?

Up to six million people on the following disability benefits will receive £150 from 20 September – potentially on top of the £650 payment:

  • Personal Independence Payment
  • Attendance Allowance
  • Scottish Disability Payments
  • Armed Forces Independence Payment
  • Constant Attendance Allowance
  • War Pension Mobility Supplement

None of these cost-of-living payments affect the tax you pay, or the benefits or tax credits you receive.

What if I’m a pensioner?

If you’re entitled to a Winter Fuel Payment for winter 2022 to 2023, you will get an extra £300 for your household paid with your normal payment from November 2022. This is in addition to any Cost-of-Living Payment you get with your benefit or tax credits.

The full amount of Winter Fuel Payment you will get for winter 2022 to 2023 depends on your circumstances. These amounts are for winter 2022 to 2023 only.

What is the Household Support Fund?

The Household Support Fund helps ease financial pressure on residents with low incomes. It offers support to help with food, fuel bills and other related essentials. You can submit one application per household. A grant of up to £300 per household is available.

Priority will be given to those with higher needs. Such as households with children and pensioners.

The scheme runs until 30 September 2022 or until all funds have been allocated.

All applications for the Household Support Fund need to be completed by your local council.

If you need debt advice or to organise breathing space to give you some time to help you deal with your finances, get in touch with us today here.