If you’re receiving Universal Credit and facing an urgent household expense — like a broken boiler, a funeral, or the need to move — you might be able to get extra support from the government. The Department for Work and Pensions (DWP) offers a special loan called a Budgeting Advance to help with one-off emergency costs.
This loan can be a financial lifeline when unexpected costs pop up and you’re short on money.
What Is a Budgeting Advance?
A Budgeting Advance is an interest-free loan for people on Universal Credit or certain other benefits. It helps cover emergency expenses, such as:
- Replacing essential household appliances (like fridges or ovens)
- Work-related costs (uniforms, tools, travel)
- Funeral costs
- Home repairs
- Moving house or paying a rent deposit
- Maternity-related expenses
- Unexpected or one-time costs
Since it’s a loan, it has to be paid back. The DWP will take small amounts out of your future Universal Credit payments to repay it, usually over 24 months (2 years).
How Much Can You Borrow?
The amount you can borrow depends on your personal situation. Here’s the maximum amount available:
- £348 if you’re single
- £464 if you’re part of a couple
- £812 if you have children
The minimum amount you can borrow is £100, but the DWP will decide the exact figure based on your circumstances and savings.
Who Can Apply?
To be eligible for a Budgeting Advance, you must:
- Have been claiming Universal Credit, Income Support, Pension Credit, income-based JSA, or income-related ESA for at least 6 months
- Earned less than £2,600 (or £3,600 for couples) in the past six months
- Have less than £1,000 in savings (if you have more, your loan will be reduced by the extra amount)
If the loan is to help you start work or deal with work-related expenses, you can apply before the six-month benefit period.
Also, you can’t apply for a second loan if you’re still repaying a previous Budgeting Advance.
How to Apply for a Budgeting Advance
If you think you qualify and need financial help, you can apply in three ways:
- Send a message in your Universal Credit online journal
- Call the Universal Credit helpline: 0800 328 5644
- Visit your local Jobcentre Plus office
Important to Know
If you stop claiming Universal Credit but haven’t finished repaying your loan, you still owe the money. The DWP can contact your employer or a debt recovery agency to get back what you owe.
New Universal Credit Payment Rates
From this month, Universal Credit standard payments have increased by 1.7%. Here are the latest monthly standard allowance rates:
- Single under 25: £316.98
- Single 25 or over: £400.14
- Couple both under 25: £497.55
- Couple one or both over 25: £628.10
These amounts are before any other elements (like child costs or health-related payments) or deductions are added.
A Budgeting Advance can be a helpful option if you’re struggling with sudden costs while on Universal Credit. It’s interest-free, easy to apply for, and helps cover a wide range of essential expenses. Just remember — it’s a loan, so it must be paid back over time. If you’re facing a financial emergency, don’t wait. Speak to your work coach, check your online journal, or call the Universal Credit helpline today to find out more.
FAQs
What is a Budgeting Advance from Universal Credit?
A Budgeting Advance is an interest-free loan offered by the DWP to help Universal Credit claimants cover emergency or unexpected expenses.
How much can I borrow with a Budgeting Advance?
You can borrow between £100 and £812 depending on your circumstances, including whether you’re single, part of a couple, or have children.
How do I apply for a Budgeting Advance?
Apply by messaging your Universal Credit online journal, visiting your local Jobcentre Plus, or calling the DWP on 0800 328 5644.
Do I need to repay the Budgeting Advance?
Yes. The DWP will deduct repayments from your future Universal Credit payments over a 2-year period.
What happens if I stop claiming Universal Credit before paying off the loan?
You still have to repay the loan. The DWP may contact your employer or use a debt collection agency to recover the amount.
