Savings and Capital Calculator

Universal Credit ignores what your savings earn and looks at the balance instead. Capital of £6,000.00 or less makes no difference at all. Above £16,000.00 there is no award, whatever your income and however many elements you qualify for. Between the two, every £250.00 or part of £250.00 above the lower limit is treated as £4.35 a month of income you never actually receive. That assumed income is called tariff income.

This calculator adds up the capital that counts, takes off anything that is currently disregarded, and shows the step you are on, what it costs a month and over a year, and how much room is left before the upper limit. It prices the answer against a real award rather than in the abstract, and it states the upper boundary to the penny: exactly £16,000.00 is still entitled, and one penny more is not.

There are two limits, not one. Capital of £6,000.00 or less has no effect at all: it is ignored completely, however long you hold it. Capital above £16,000.00 means there is no entitlement to Universal Credit, whatever your income and however many elements you qualify for. Between the two, you keep the award but it is reduced, because every £250.00 or part of £250.00 above the lower limit is treated as £4.35 a month of income you never actually receive. That assumed income is called tariff income, and at the top of the band it reaches £174.00 a month, or £2,088.00 a year. Neither limit has moved since Universal Credit began: the words in the regulations today are the same words as in 2013.

Take your total capital, take off £6,000.00, and divide what is left by £250.00. Then round that figure UP, because the rule charges £4.35 for each complete £250.00 and a further £4.35 for any excess that is not a complete £250.00. Multiply the number of steps by £4.35 and you have the monthly figure. The rounding is the part almost every other page leaves out, and it is the part that surprises people: one pound over a step boundary costs a whole step, so £6,001.00 is charged exactly the same as £6,250.00. Working the other way, spending down to the step below saves £4.35 a month, and spending down to £6,000.00 removes the charge entirely.

Above it. The financial condition in the Welfare Reform Act 2012 is that your capital is "not greater than" a prescribed amount, and the regulations set that amount at £16,000.00. So capital of exactly £16,000.00 still qualifies, at the maximum 40 steps of tariff income, which is £174.00 a month. One penny more and there is no award at all. For a single claimant aged 25 or over with no other income that penny is the difference between £250.90 a month and nothing, which is £3,010.80 over a year. DWP's own decision makers' guidance prints the same boundary: the row ending at the limit yields £174.00, and the row above it says the claimant cannot get benefit. It is worth knowing to the penny, because it is the one number on this subject that no other calculator states.

All money, savings and investments, in the UK and abroad. Cash, current accounts, digital accounts, savings accounts, credit union and NS&I accounts, Premium Bonds, shares, dividends and cryptoassets. Every kind of ISA counts in full, including a Lifetime ISA and a Help to Buy ISA, which surprises people who assume a tax wrapper protects them. So do savings you hold for a child in your own name, money that belongs to someone else but sits in your name, inheritance payments, and benefit payments such as PIP or Child Benefit once they have gone unspent long enough to stop being income. Property you own but do not live in counts, valued at market value less a tenth for the costs of sale and less any mortgage secured on it. Your personal possessions do not count, whatever they are worth, and neither do your debts: a balance of several thousand pounds with a credit card bill against it is still capital in full.

Three groups. Ignored for good: the home you live in, an undrawn pension pot, the surrender value of a life insurance policy, a funeral plan, business assets while you are trading, and compensation from the listed special schemes such as Windrush, Grenfell, the infected blood schemes and Post Office Horizon. Ignored for twelve months: personal injury and illness compensation, arrears of benefits, Social Fund payments, local welfare provision and the initial Bereavement Support Payment lump sum. Ignored for six months, extendable where it is reasonable: the proceeds of selling your former home where you intend to buy another one to live in, a property you are taking reasonable steps to sell, business assets after you stop trading, and insurance payouts for damage to your home. The twelve-month one is the deadline that costs people most. Personal injury compensation sitting in an ordinary account starts counting in full on the anniversary, and after that only money placed in a personal injury trust, used to buy an annuity or administered by a court stays ignored. That window cannot be reopened once it closes.

Not while the provider is holding it. The right to receive a pension is disregarded for as long as the pot is untouched, and a claimant under State Pension age is not expected to draw a pension early to reduce a Universal Credit claim. What matters is how you take it. An ad hoc withdrawal or a whole-pot withdrawal lands on your capital total on the day it arrives, so drawing a large lump sum can end an award outright. Regular withdrawals are treated as unearned income instead, deducted pound for pound in the month they are paid and never touching the capital limits at all. The same pot taken two different ways gives two very different answers. There is one exception to watch in a mixed-age couple: a partner who has reached the qualifying age for Pension Credit and has not applied for a pension they could take can be treated as receiving notional retirement pension income even though the pot itself is still disregarded.

No. The regulations prescribe £16,000.00 for a single claimant and £16,000.00 for joint claimants. There is no couple uplift, so two people holding a little over half of it each are over the limit between them and neither can be paid. Your partner's capital also counts where you claim as a single person because you are a couple for Universal Credit purposes, and it counts even if your partner is not eligible themselves, for example because of immigration status or because they have reached State Pension age. Where an asset is held jointly with someone who is not your partner, a parent or a sibling on an inherited property or a joint account, each holder is presumed to own an equal share unless there is evidence to the contrary. The practical result is that a couple is worse off than two single claimants with the same money between them, which is the opposite of what most people expect.

Tariff income is unearned income, so it is deducted from your maximum Universal Credit in full, pound for pound, before the taper touches your wages. It is not reduced by the work allowance and it is not tapered at 55p in the pound, because that only applies to earnings. It is also not a deduction in the debt sense, so the cap on what can be taken for advances and arrears does not limit it, and it is applied before the benefit cap rather than after. A working household with savings takes both hits at once and they are worked out separately: 55p of every pound earned above the work allowance, which is £427.00 a month where the award includes housing and £710.00 where it does not, plus £4.35 for every step of capital. One more thing follows from the same rule: interest is never income for Universal Credit. It simply joins the balance, which is why a savings account can quietly move you up a step without you doing anything.

Only for genuine reasons. Capital you dispose of in order to get Universal Credit, or to get more of it, is treated as though you still have it, and it is called notional capital. Paying off or reducing a debt is never deprivation, and neither is buying goods or services where the spending was reasonable in your circumstances. Nor is spending on the necessities of life, because there was no real choice. Giving money away, or spending it extravagantly, is a choice, and that is where the rule bites. Two things about how it is decided are worth knowing. You have to show the money is genuinely gone, and if you cannot it is treated as capital you still hold. DWP has to show that getting Universal Credit was a significant purpose of the spending, though it does not have to be the main one. Notional capital does reduce each assessment period under the diminishing notional capital rule, but on a large sum that takes years rather than months, and nobody should model it with a calculator. If this is your situation, get advice before you spend anything.