DWP sends out Universal Credit letters as Martin Lewis warns 'don't ignore'

The DWP is sending out letters to households across the UK with a warning not to ignore it or you could lose all your benefits.

The Department for Work and Pensions is currently undergoing a 'migration' process to transfer people on various legacy benefits onto Universal Credit.

Benefits included in that comprise Tax Credits like Working Tax Credits and Child Tax Credits.

Those being transferred to Universal Credit are being sent migration notice letters and if you receive one, you MUST take action, Martin Lewis' Money Saving Expert website has warned.

After you receive such a letter, you must make a claim for Universal Credit before the deadline set out in the letter, or your benefits will stop - and you cannot elect to stay on Tax Credits.

There is a quirk in the rules which could mean you're better off on Universal Credit than you would otherwise have been thanks to having been on Tax Credits.

Martin Lewis' MSE explains: "If you make your Universal Credit claim after you receive the migration notice, and before the deadline date, then some of the standard Universal Credit eligibility rules won't apply to you.

"For example, you'll still be eligible for Universal Credit for 12 months even if you have savings over £16,000, or you are currently a student. This means you won't be worse off financially when you apply for Universal Credit as part of the official managed-migration process."

The DWP may even hand you a 'top up' payment if you're entitled to less money on Universal Credit than you would have received or were already receiving on Tax Credits, to ensure people don't miss out on money by being moved to Universal Credit.

These transition arrangements are permanent, until the time your UC benefits catch up to what you have from Tax Credits. For example, when inflation lifts the amount Universal Credit pays out, it will eventually outstrip what you used to get on Tax Credits and at this point your transition top up payments will stop.