Benefits after redundancy

New-style Jobseeker's Allowance (JSA) 

This is a benefit for people who are unemployed or working less than 16 hours each week. 

New style JSA is the new name for contribution-based Jobseeker's Allowance. To be entitled you must have paid enough Class 1 National Insurance contributions over the past two years. It is not means tested so can be paid if you or your partner have other money coming in. It is paid for 6 months at flat rate whether you are single or a member of a couple. A pension of over £50 a week will reduce the amount paid. 

Universal Credit (UC) 

You may be able to claim Universal Credit if you are not entitled to New-Style JSA or as a top-up to JSA. If you are receiving Tax Credits, be aware that your Tax Credits will stop as soon as you claim Universal Credit, so it is best to check whether you are better off continuing on Tax Credits or claiming Universal Credit.

UC is a means tested benefit, so the amount payable depends on personal circumstances such as whether you have children or are disabled. UC can also include help towards your rent.  If you or your partner have any earnings or other income such as occupational pensions, it can reduce the amount of UC you receive.

Claiming UC means that you may get additional help such as free school meals, free prescriptions, free dental treatment, vouchers for glasses and hospital fares. 

When you claim either JSA or UC you are required to agree to and sign a claimant commitment as a condition of getting benefit. This sets out what you are expected to do to return to work. You will also get help from the Jobcentre to do this. 

You can claim new style Jobseeker's Allowance online or, if you cannot claim online, by calling 0800 055 6688. 

You can claim Universal Credit online or, if you cannot claim online, by calling 0800 3285644.

Wages in lieu of notice 

If you have been paid wages for any notice you were entitled to but did not work, you will probably not be able to receive JSA until the notice period expires. However, you should still make a claim, and have details of the Redundancy or Lieu of Notice letter handy when you do. 

If you are claiming Universal Credit, any wages you receive after the start of your claim will be deducted even if they are for an earlier period. 

Taxation 

Jobseeker's Allowance is taxable. If you think you are due a tax rebate it won't be paid until the end of the tax year. Universal Credit is not taxable. 

Lump-sum redundancy payments 

The rules for how these can be treated are complex, and they can affect JSA and Universal Credit differently. They are usually treated as 'capital' but if you receive such a payment let the Department for Work and Pensions know straight away. 

Capital and savings

New style JSA is not usually affected by redundancy payments but if you are claiming UC or other means-tested benefits these can be affected depending on the amount of the redundancy payment and your other savings.

You cannot get Universal Credit or Council Tax Reduction if you have £16,000 or more in savings or other capital (including redundancy payments). If you have between £6,000 and £16,000, for UC, you are treated as having income of £4.35 each month for every £250 in savings that you have above £6,000. 

Mortgage help 

After three months on Universal Credit you can get a loan to help towards your mortgage interest, which must be paid back, with interest, when you sell or transfer ownership of your home.

Help with rent and council tax 

If you rent your home, you can get help with the rent as part of your Universal Credit. 

You can claim Council Tax Reduction (CTR) separately from the Council. It is not included in your JSA or UC claim. It is a means-tested benefit and the amount of help will depend on your individual circumstances.