Universal Credit payment period dates?

by Readers Question

10:52 AM, 27th December 2019
About 11 months ago

Universal Credit payment period dates?

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Universal Credit payment period dates?

I have heard about landlords coming unstuck with UC payment periods for tenants. What’s the best way to ensure you get all your rent paid?

Start a tenancy a day before or on the day of payment period date, or during it?

I have already found out to my cost that UC won’t backdate any rent genuinely owed so want to avoid this again.

Also, can UC actually change a payment period date if an existing tenant has to make an amendment to the address of an existing claim?

I have a tenant who wants to move from a one bed to a two bed in the same block. Would there payment period change in light of this or continue as is?

Any advice would be very welcome.

Reluctant


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Comments

Rob Crawford

11:06 AM, 27th December 2019
About 11 months ago

Are you really dependent on UC tenants?

WP

12:33 PM, 27th December 2019
About 11 months ago

totally. HB tenants few and far between now so UC only option. Area not a great area for private tenants,

Marie

21:59 PM, 28th December 2019
About 11 months ago

Reply to the comment left by WP at 27/12/2019 - 12:33
Where is this???

Anne Nixon

9:21 AM, 29th December 2019
About 11 months ago

Reply to the comment left by WP at 27/12/2019 - 12:33Shame you haven't had an answer to your question as I'm currently living this - I took on a UC tenant 4 weeks ago and haven't been paid yet.
This is the first time (and probably the last) so I don't know what to do, who to contact or what to expect.

WP

22:13 PM, 29th December 2019
About 11 months ago

Reply to the comment left by Marie at 28/12/2019 - 21:59
Torquay

Bill irvine

10:05 AM, 30th December 2019
About 11 months ago

Hi

As I'm sure you're aware, Universal Credit differs from Housing Benefit in a number of ways. One of the most important is, it's assessed and paid on a calendar monthly basis, as opposed to HBs weekly (asessment period) and 2 or 4 weekly payment cycle. It's also administered by DWP rather than your local council's HB/LHA department.

To illustrate some of these differences, let's assume you start a tenancy today and the tenant makes a first claim for Universal Credit online today. Assuming he/she completes the claim and attends an interview with his/her nominated "work coach", usually within 1 week of the claim, the award will be made from 30th December to 29th January (Benefit Assessment Period) with payment, including "housing costs" being made on 5th February (7 days later).

Once established, each month thereafter, he/she will be paid from the 30th to 29th and be paid on the 5th (March, April etc.)

If the tenant vacates, without telling you, on, let's say, the 27th February and moves into a new tenancy on that date, DWP treats him/her as living at the new address for the "whole" of the period 30th January to 29th February 2020, even though he's lived at your address for most of that period and is still contractually liable to you for rent. DWP refers to this as the "whole month rule" which, in this case, is dictated by the fact he is resident at the new property on 29th February (the last day of the BAP).

Using another example, let's say, you offer a tenancy to someone today and they are already claiming UC, with a BAP 10th December to 9th January 2020. In that case, he/she needs to notify DWP, using the online journal of the change in his/her circumstances and provide validation of his new rental charge. If he/she does this, payment of the "new" rent should be included in the 16th of January payment. No provision is made for any outgoing rental charge, as unlike HB/LHA there is no "4 weeks overlapping liability provision".

Let's also consider, one of your exisiting tenants, currently receiving JSA and HB/LHA paid direct to you. Prompted by his "work coach" he decides to make a new claim for Universal Credit today. He makes his online claim; confirms "claimant commitment" to the Work Coach; and validates his current rental charge. He also points out to his Work Coach that his LHA is paid direct to you because of exisitng rent arrears and would prefer if payment of his UC "housing costs" could be paid to you direct.

In that scenario, DWP should pay his "housing costs" with effect from 30th December. DWP also sends a "stop notice" to the local council, in terms of HB/LHA. As this is the tenant's first UC claim, the Council should pay you a "2 weeks run-on of LHA". This is designed to cushion the gap between the last payment of HB/LHA and the tenant's first award of UC on 5th February 2020. The Work Coach could also trigger, payment of your tenat's "housing costs" to you, on the basis LHA was being paid direct and rent arrears of more than 2 months rent still exist.

In terms of "backdating", for "new claims", the rules on UC are much more prescriptive than HB/LHA with an absolute time bar of 1 month. However, if your tenant has been underpaid "housing costs" because of an error made by DWP or a failure of the tenant to validate their true housing costs e.g rental change; birth of a new or additional child, attracting higher number of rooms, payments can be backdated. For example, in one of my recent members' bulletins I reported £25K & £13K backdated awards where DWP's staff completely overlooked a number of important factors.

Finally, you asked - "I have a tenant who wants to move from a one bed to a two bed in the same block. Would there payment period change in light of this or continue as is?

Answer: Payment period doesn't alter. If the move to the 2 bed property attracted the 2 bed rate (e.g. female tenant living alone has a baby) then her "housing costs" could be increased, assuming she notifies the change on her journal" on the basis of her BAP.

I hope these illustrations help to improve your understanding of how UC works.

If you're heavily committed to providing tenancies to benefit reliant tenants, it's important to educate yourself on UC's range of nuances, as all "working age" (66 and under) tenants, including their partners, estimated to be around 5 million more, will migrate to UC from HB/LHA over the next 2/3 years. The more you know about the scheme, the less likely you'll lose that much needed rental income. If you're interested in finding out more, check out the RLA's Training Unit's programme http://www.rla.org.uk

Bill Irvine

WP

10:26 AM, 30th December 2019
About 11 months ago

Reply to the comment left by Bill irvine at 30/12/2019 - 10:05
Thanks you VERY much Mr Irvine! A wealth of info here for me to digest. I have become a LL by default in reality (father retired leaving me to look after it all!) and I'm finding it all a bit of a shock. No one place with all the info needed and conflicting info when I do find some nugget to rely on. I think one thing is for sure, if I find this complicated, an uneducated tenant has no chance. I understand you run courses, or have a website with more free info? I'd be very interested please.

Bill irvine

10:41 AM, 30th December 2019
About 11 months ago

Reply to the comment left by WP at 30/12/2019 - 10:26
Hi WP

The RLA course “Universal Credit” (10am - 3.30pm) is run in various regional centres. We’ve just completed ones in Sheffield, Manchester, Birmingham. Have a look at its website for more details.

I also offer 1-1 consultations, in-house seminars and my website http://www.ucadvice.co.uk but all of these are chargeable.

Alternatively, try and hook up with an experienced UC landlord.

Bill


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