Universal Credit (UC)
Universal Credit and landlords
1. What Universal Credit means for landlords
This section focuses on those aspects of Universal Credit that are most relevant to landlords. For more detail about specific elements, or to find out how Universal Credit works from a tenant’s perspective, see the New to Universal Credit section. You can also find out more through the DWP partnership teams
For an overview of the main things landlords need to know see Universal Credit: Top tips for landlords
How Universal Credit works
Universal Credit is for people who are on a low income or out of work. It is usually paid as a single monthly payment to a whole household, and can include help towards housing costs. It is normally paid direct to claimants, and it is their responsibility to pay their rent themselves.
The amount of Universal Credit your tenant receives depends on their individual circumstances. The exact amount is calculated every calendar month.
People may continue to receive Universal Credit even when they are in work, depending on their earnings. The amount of Universal Credit they get will respond automatically to changes in their earnings. If their earnings go up, this can reduce their Universal Credit payment.
In Scotland, claimants who have an online Universal Credit account can choose to have their housing costs paid straight to their landlord. They can also choose to receive Universal Credit payments twice a month if they prefer.
How much tenants get towards their housing
See the Housing section for a full explanation of what support Universal Credit claimants will get towards their housing costs. In most cases:
Private sector tenants will receive whichever is lower out of their actual housing costs and the relevant Local Housing Allowance rate.
Social sector tenants will receive their actual housing costs, minus any reductions for spare bedrooms (14% reduction for one spare bedroom, 25% for 2 or more). There are some exceptions: see the factsheet on the Removal of the Spare Room Subsidy
Universal Credit can help towards some service charges but evidence will need to be provided of these costs.
It’s important to note that the amount a claimant gets will not always cover the whole of their rent.
For example, if their private sector rent is more than the relevant Local Housing Allowance rate, they will need to pay the difference themselves. And tenants in the social sector who have a spare bedroom may see a reduction in the amount they receive towards housing – again, it will be up to them to make up the difference.
If a claimant is in work, this can reduce their Universal Credit payment. The amount they receive towards housing is not protected, so if their Universal Credit payment is reduced, they will probably need to use some of their earnings to make up any difference.
Additional Housing Benefit payment
If a claimant received Housing Benefit up to the date they applied for Universal Credit, their Housing Benefit will continue for the first 2 weeks of their new Universal Credit claim. The payment will be made automatically – most claimants do not need to contact their local authority about this. However, if they have moved home, they should contact the local authority who paid their Housing Benefit to make sure they have the correct details to make the payment. If Housing Benefit was paid direct to a landlord and the claimant has not moved home this final payment will go to that landlord.
Following this final payment, Housing Benefit will usually stop when the Universal Credit claim is approved. This happens automatically – the claimant won’t need to tell their local authority that they’re moving to Universal Credit.
Temporary, supported or sheltered housing
If a claimant lives in:
- temporary accommodation because the local authority placed them there due to homelessness
- supported housing, or
- sheltered housing
they will not receive anything towards their housing costs through Universal Credit. Instead they will need to claim Housing Benefit
People in this situation can still receive Universal Credit to help with their other costs.
There are a small number of people who will already receive help with temporary accommodation housing costs through Universal Credit. If someone receives this it will continue until there is a change to the amount of rent they pay. When that happens they will need to claim Housing Benefit as well as Universal Credit, and their Universal Credit payment will no longer include an amount towards housing.
When housing costs are assessed
Universal Credit is usually paid as a single monthly payment. The amount someone gets is calculated each calendar month, and depends on their circumstances during their preceding assessment period
A claimant’s first assessment period begins on the date they make their claim. It runs for one calendar month, and the claimant will receive their first payment 7 days after it ends. All subsequent assessment periods begin on the same date of the month (eg the 13th), end on the same date of the month (eg the 12th), and all payments are made on the same date of the month (eg the 19th).
A claimant’s housing support is calculated on the last day of their assessment period. Whatever circumstances are in place on that date will be considered to have been the case for the whole assessment period.
So if a claimant moves out of your property during their assessment period, the amount they get in housing costs will reflect their situation at the end of that assessment period. This means that if they are not paying any rent at that point, they will receive no help towards housing costs for that month.
You should make sure your tenant is aware of this so they can make arrangements to pay any outstanding rent.
Help with paying housing costs
In most cases Universal Credit is paid to the claimant, and it’s up to them to pay their rent themselves. However, in some circumstances housing costs can be paid straight to the landlord, if this is needed to help a claimant manage their household costs. In Scotland, claimants who have an online Universal Credit account can choose this option themselves. To find out more see What landlords need to do
If a claimant’s Universal Credit payment doesn’t cover all of their housing costs they may be able to get extra help from their local authority through a discretionary housing payment
Universal Credit claimants may also be eligible for a reduction in their Local Council Tax. They can start the process to apply for Local Council Tax Reduction on GOV.UK. It will take them to their local council’s website, which will tell them what they need to do.
New Universal Credit claimants should apply for Local Council Tax Reduction straight away, as many local councils will not backdate it. They do not need to wait until their claim for Universal Credit has been approved or paid.
2. What landlords need to do
As a landlord you have certain responsibilities to help your tenant make and manage their Universal Credit claim. Here’s a few things you can do to help their claim go smoothly and help ensure you receive rent payments in full and on time.
1. Confirm housing costs
Private sector tenants
You can help your tenants by making sure they have documents that are up to date and correct.
If a claimant applies for help towards private sector housing costs as part of their Universal Credit claim, they will be asked to provide proof of:
- liability to pay rent
- occupancy of the property they are claiming for
If they don’t have a signed tenancy agreement which shows the current rent, a signed letter from the landlord or letting agent is acceptable.
This evidence should be provided by the claimant at their first appointment at the jobcentre. Claimants will not receive any help towards housing costs until they provide this proof. If a private sector tenant hasn’t provided all the information required, the Department for Work and Pensions will contact them.
Please note that private sector landlords will not be informed that their tenant has made a claim for Universal Credit.
Social sector tenants
If your tenant applies for help towards social sector housing costs as part of their Universal Credit claim you will be asked for details of their housing costs. Please make sure your tenant knows the following when they make their Universal Credit claim:
- Their postcode
- Your organisation’s name (or your name if there is no organisation name)
- Your postal address
- Your telephone number
- Your email address
If you are registered on the Landlord Portal you will receive this request through there. The Department for Work and Pensions is contacting social sector landlords to invite them to register on the Landlord Portal. Watch social sector landlords explain how the Portal has helped them:
If you are not registered on the Landlord Portal you will be sent a housing verification form by email.
You will need to confirm your tenant’s housing cost details before they can receive any help towards their housing costs through Universal Credit. Responding quickly will help make sure you receive rent payments on time.
2. Consider whether rent should be paid straight to you
In some cases where a claimant is having trouble managing their money, it may be appropriate for their Universal Credit housing costs to be paid straight to their landlord.
This is known as an Alternative Payment Arrangement. The guidance on Alternative Payment Arrangements provides more information about the process and which tenants this will be appropriate for.
All landlords can apply for the direct payment of rent from the start of a Universal Credit claim using the UC47 form. Social sector landlords can also apply through the Landlord Portal or as part of the rent verification process.
If you received a managed Housing Benefit payment from the local authority you should make sure you familiarise yourself with the process for Alternative Payment Arrangements. Direct payments to a landlord will not be automatically put in place when someone moves onto Universal Credit. However, if a tenant tells the Department for Work and Pensions that their Housing Benefit was paid direct to their landlord, this can be continued from the start of their Universal Credit claim if the claimant still needs this support.
3. Understand how to resolve issues
In most cases you should attempt to resolve any claim or payment issues with your tenant. It will usually be the case that they can raise and address it through their online Universal Credit journal.
If this is not possible or the issue remains unresolved you can call the Universal Credit Service Centre on 0800 328 5644. Once you’ve answered a few questions about your tenant you can be put straight through to the relevant case manager.
The Department for Work and Pensions will usually need explicit consent from the claimant before talking to a landlord or other third party about their claim. The claimant can provide this through their online journal or by calling the Universal Credit Service Centre. They will need to provide:
- A contact name at your organisation
- The name of your organisation
- Brief details about the issue
If a direct payment of rent to the landlord is in place, a case manager can speak to a landlord about the payment without the need for this consent.
For more information see Universal Credit consent and disclosure of information
If the issue is urgent or still unresolved you should contact your local jobcentre. The partnership manager can help with general queries, and the work coach team leader will deal with claimant-specific issues. Find out how to contact them by emailing the DWP partnership teams
4. Read the guides for landlords
There’s more information in the guidance on Universal Credit and landlords. It includes detailed guidance on:
- Rented housing
- Service charges
- Disclosure
- Reporting social rented sector rate changes
- Housing costs for 18 to 21 year olds
- Personal budgeting support and Alternative Payment Arrangements
5. Help your tenant prepare
Prepare your tenant for Universal Credit by having discussions about paying rent and making sure they understand how Universal Credit payments work. See How landlords can help their tenants for ways to support and advise them.
3. How landlords can help their tenants
As a landlord you are well placed to help your tenants understand Universal Credit and what they can do to ensure their housing costs are paid. Here’s a few ways in which you can support and advise them.
Get ready for Universal Credit
You can prepare for Universal Credit by:
- familiarising yourself with how Universal Credit works
- considering whether adapting your policies or processes will help your tenants pay their rent on time
- engaging with your tenants early to start assessing their needs, and making sure they understand their responsibilities and the support available
Claiming the right benefit
Direct your tenants to a benefits calculator to help them understand what benefits they could get. They will be asked to enter information about their circumstances, and it will tell them which benefits they might be able to apply for. One of those might be Universal Credit.
Prepare your tenants for Universal Credit
Landlords can help tenants to get ready for Universal Credit by encouraging them to:
- Go online. Most people claim and manage Universal Credit online. If tenants don’t have access to the internet or are not confident using a computer, the jobcentre can tell them about local services that can help.
- Open an account that can receive payments. Universal Credit will be paid into a bank, building society or credit union account. The Money Advice Service provides tips on choosing the right account
- Set up a direct debit or standing order. Tenants will usually be responsible for paying their rent themselves. Setting up an automatic payment may help them pay in full and on time.
- Consider budgeting support. Your tenants may be used to managing their money on a monthly basis, but if not they will need to make sure they can pay all their bills from their single payment. The Money Advice Service’s online money manager could help them make their money last longer.
- Claim straight away. Some claimants delay making their claim because they think they will move into work quickly. You should encourage your tenants to claim as soon as possible to reduce the risk of their Universal Credit payments being delayed.
If you’re a private sector landlord you can help your tenant’s claim run more smoothly by making sure they have up to date evidence of their housing costs. They will need to provide this before they can receive any money towards their housing.
Confirm housing costs quickly
If you’re a social sector landlord you will be asked to confirm your tenant’s housing costs. Doing this quickly will help make sure there are no delays to your tenant’s first Universal Credit payment, which will help you receive your rent payment on time.
Private sector landlords are not required to confirm housing costs – this is all done through the evidence the claimant provides.
Arranging rent payments
Claimants will usually arrange their own rent payments.
Universal Credit is normally paid monthly, on the same date each month. As a landlord you should think about how this will fit with your own payment calendars, and whether changes to how and when you collect rent would help.
You should also consider the level of support some tenants may need to make the successful transition to a single, direct monthly payment. In some situations it may be appropriate for their Universal Credit housing costs to be paid straight to you. This is known as an Alternative Payment Arrangement. In Scotland, claimants who have an online Universal Credit account can choose this option themselves.
If you have previously received a managed Housing Benefit payment from the local authority, you will need to speak to your tenant to agree arrangements for collecting rent from them. Direct payments to a landlord will not be automatically put in place when someone moves onto Universal Credit.
Some claimants may be eligible for extra help with paying housing costs through discretionary housing payments or a reduction in their Local Council Tax.
Reporting changes
Claimants are responsible for telling the Department for Work and Pensions of any changes that might affect their Universal Credit payment. This includes things like annual rent changes, changes to service charges, separating from a partner, or a partner moving in.
If you know of changes that might affect your tenant’s Universal Credit payment, you can help by reminding them to inform the Department for Work and Pensions. If incorrect Universal Credit payments are made because of delays in reporting changes, this may mean that later payments are reduced.