Low income cost of living payment 2023: Millions of low-income households in the UK will get up to £1,350 to help with cost of living

More detail on the cost of living payment schedule for low-income households this year has been set out by the Department for Work and Pensions (DWP).

Further details about the Cost of Living Payment, which was initially set out in the Chancellor’s Autumn Statement last year, have been published on Tuesday, January 3, 2023. The cost of living support follows the payments made to help more than eight million people in 2022.

DWP secretary, Mel Stride, said: “We are sticking by our promise to protect the most vulnerable and these payments, worth hundreds of pounds, will provide vital support next year for those on the lowest incomes. The government’s wider support package has already helped more than eight million families as we continue to deal with the global consequences of Putin’s illegal war and the aftershocks of the pandemic.”

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Chancellor of the Exchequer, Jeremy Hunt, said: “I know these are tough times for families across the UK who are struggling to meet rising food and energy costs, driven by the aftershocks of Covid and Putin’s war in Ukraine. That’s why we’re putting a further £900 into the pockets of over eight million low-income households next year. These payments are on top of above inflation increases to working-age benefits and the Energy Price Guarantee, which is insulating millions from even higher global gas prices. Tackling inflation is this government’s number one priority and is the only way to ease the strain of high prices, drive long term economic growth and improve living standards for everyone.”

One pound coins and notes. (Pic credit: Dominic Lipinski / PA Wire)One pound coins and notes. (Pic credit: Dominic Lipinski / PA Wire)
One pound coins and notes. (Pic credit: Dominic Lipinski / PA Wire)

Low-income cost of living payment

The new £900 cash boost for more than eight million eligible means-tested benefits claimants, including those on Universal Credit, Pension Credit and tax credits, will start in Spring and will go directly into bank accounts in three payment instalments over the course of the financial year.

There will also be a separate £150 for more than six million disabled people and £300 for more than eight million pensioners as well as their Winter Fuel Payments.

The exact payment dates will be announced nearer the time, but are spread across a longer period to make sure consistent support is offered throughout the year.

Broad payment windows are as follows:

- £301 first Cost of Living Payment (during spring 2023)

- £150 Disability Payment (during summer 2023)

- £300 second Cost of Living Payment (during autumn 2023)

- £300 Pensioner Payment (during winter 2023/24)

- £299 third Cost of Living Payment (during spring 2024)

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If individuals are eligible, they will be paid directly and they won’t need to apply. Eligible claimants for any of the Cost of Living Payments and receive tax credits, and no other means-tested benefits, will get payment from HMRC soon after DWP payments are sent off.

These payments build on the government’s support package to help households through the globally rising cost of living resulting from the pandemic and the war in Ukraine.

They will all be tax-free, will not count towards the benefit cap, and will not have any impact on existing benefit awards. Eligible households will be on one of the following benefits: Universal Credit, Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit and Pension Credit.

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