Universal Credit is undergoing big updates in 2025, and if you’re on benefits—or thinking of applying—this guide is for you. From a small pay rise to reduced debt deductions, and even changes to health-related support, the new rules aim to make things a bit fairer and more affordable for struggling families and individuals. Whether you’re on legacy benefits or already moved to UC, knowing what’s coming will help you stay on track.
Updates
Here’s a snapshot of the key Universal Credit changes happening in 2025:
| Change | Details | Effective Date |
|---|---|---|
| Benefit Increase | 1.7% rise in UC payments | June 2025 |
| Deductions Cap Reduction | Max deduction drops from 25% to 15% | 30 June 2025 |
| Health Element Reform | New claimants get £50/week, not £97 | June 2026 |
| Legacy Benefit Migration | ESA and others moved to Universal Credit | Now to May 2026 |
| Household Support Fund | £742 million emergency help via local councils | June 2025–May 2026 |
Increases
Universal Credit payments went up by 1.7% in June 2025 to keep up with inflation. It’s not massive, but every little helps—especially with food and rent prices still rising.
Here are a few examples of new 2025 rates:
| Category | New Monthly Rate (2025) | Previous Rate (2024) |
|---|---|---|
| Single adult (25+) | £400.14 | £393.45 |
| Couple (one or both 25+) | £628.10 | £617.60 |
| First child (under 16) | £333.33 | – |
| Work allowance (higher rate) | £673 | £662 |
You’ll get the new rate from May or June, depending on when your assessment period started.
Deductions
Big win here—if you’ve had money taken from your UC for things like debts or rent arrears, that chunk is getting smaller. From 30 June 2025, the DWP will cap deductions at 15% of your UC, down from the previous 25%.
This means more money in your bank each month. On average, households could keep up to £420 more a year, which is a real help when budgeting gets tight.
Health
Starting June 2026, new UC claimants who qualify for the health element will get £50 per week, instead of the current £97. If you’re already getting the £97 before that date, you’ll keep it—but it’s frozen until 2029.
Why the drop? The DWP wants to target higher payments at people with severe, lifelong conditions, and encourage others into work-related activity where possible.
Migration
If you’re on an older benefit like ESA, JSA, or Housing Benefit, you’ll be moved to Universal Credit by May 2026. You’ll get a letter—called a Migration Notice—and have three months to claim UC or risk losing out.
Here’s a list of legacy benefits being phased out:
- Income-related ESA
- Income-based JSA
- Income Support
- Working/Child Tax Credits
- Housing Benefit
If you need help switching, organisations like Citizens Advice offer free support to guide you through it.
Support
The Household Support Fund is back for another year with £742 million in funding. If you’re struggling to cover essentials, you can apply through your local council.
What can it help with?
- Food and groceries
- Energy and water bills
- Essential clothing
- Housing costs (in emergencies)
This support is not automatic—you’ll need to apply through your local authority. Each council sets its own rules, so it’s worth checking what’s available where you live.
FAQs
When will UC payments increase?
From June 2025, with 1.7% rise applied.
How much are deductions capped at?
15% of your Universal Credit payment.
What is the new health element rate?
£50/week for new claimants from June 2026.
Do I need to apply for UC if migrating?
Yes, within 3 months of receiving your notice.
Where to get help with essentials?
Apply to your local council’s Household Support Fund.