Universal Credit claimants with children have been alerted to the potential for childcare support worth up to £1,739 per month. This is part of the UK Government's initiative to help more parents enter the labour market and achieve long-term financial stability.
Universal Credit Changes
Parents on Universal Credit for a child under 17 can now claim up to £1,015 a month towards childcare costs, instead of £950 under the previous rules. Families with two or more children can claim up to £1,739 to cover the full cost of childcare.
This significant boost to childcare assistance will help more parents enter the workforce and achieve long-term financial security. We are fulfilling our plan to help people into jobs, as we reduce taxes, lower inflation, and return money to hardworking families.
Child Benefit Payment Increases
Families with a single child will now receive £1,331 a year, an increase of more than £83 on the previous situation. Furthermore, for each additional child, families are entitled to £881 per year, an annual increase of £54.60.
Importantly, there is no limit to the number of children eligible for child benefit. Instead, parents will receive £102.40 every 4 weeks (£25.60 per week) for the first or only child and £67.80 every 4 weeks (£16.95 each week) for each additional child.
For households already receiving benefits, there is no need to contact HMRC, as the increased payments will continue to be paid directly into their bank accounts.
However, if anyone needs to update their details, such as a change of bank or address, they can do so via the HMRC app or online at GOV.UK.
HMRC is encouraging new parents to apply as soon as possible, with the first payments being made within three days. Parents of newborn babies can also claim child benefit retroactively for up to three months.
Changes to Child Benefit Rules
As of this month, households earning up to £60,000 a year will no longer be subject to the High Income Child Benefit charge. Before, those earning more than £50,000 were subject to this tax if they were in receipt of child benefit.
When the change was introduced in last month's Budget, Chancellor Jeremy Hunt claimed that two parents earning £49,000 would receive the full allowance, while one household would not.
Hunt set out plans to "end this unfairness" by reforming HMRC to collect tax information at household level, and by consulting a household-based high-income system from April 2026. However, it has also enacted two interim changes "to make the current system fairer".
Laura Trott, Chief Secretary to the Treasury, claimed that the inequities in the child benefit system were being eliminated. Consequently, 170,000 families will no longer have to pay child benefit and nearly 500,000 families will save an average of £1,300 next year.