UC savings rule

Caterpillar1

Can someone explain to me in basic terms if I have got this right please. I am on ESA and shortly moving to UC, it sounds quite complicated but from what I understand an assessment period is 1 month. So if I got paid UC on say the 15th of the month, is it that the money in your bank account has to be below £6k (for no penalties) by the following month on the 15th, but it is ok if it goes up to eg. £7k in the middle of the month? As long as it is back down again by the 15th?

Also how does that work in ESA as you get paid twice a month?
if someone can just explain it all, so I know the rules. It’s all very overwhelming to me.

SimonFF

I think the benefit payment becomes capital if is not spent by the end of the assessment period. The system punishes those who save and encourages those who spend.

kaMelo

Caterpillar1 said:

Can someone explain to me in basic terms if I have got this right please. I am on ESA and shortly moving to UC, it sounds quite complicated but from what I understand an assessment period is 1 month. So if I got paid UC on say the 15th of the month, is it that the money in your bank account has to be below £6k (for no penalties) by the following month on the 15th, but it is ok if it goes up to eg. £7k in the middle of the month? As long as it is back down again by the 15th?

Also how does that work in ESA as you get paid twice a month?
if someone can just explain it all, so I know the rules. It’s all very overwhelming to me.

You've basically got it, money received is income for the period it is received for. UC payments are income for a month, ESA payments are income for two weeks, earnings through work are income for whatever pay period they cover. At the end of the period for which you have received money anything left becomes capital.
Despite ESA having a different pay period, even though technically it becomes capital after two weeks UC are only actually interested in whatever capital you have left at the end of each assessment period. Total up everything you have, deduct any payments you have received in that assessment period such as UC, ESA, earnings etc. and what you have left is the capital you report (not forgetting any applicable amounts that can be disregarded such as COL payments).

SimonFF said:

I think the benefit payment becomes capital if is not spent by the end of the assessment period. The system punishes those who save and encourages those who spend.

The system expects those with means to support themselves to do so, targeting more support to those who don't