Coronavirus, welfare benefits & money


As well as worries about the health loved ones, you may also have concerns about the financial implications for your family, particularly if you or a partner are likely to have to stop working or see a significant drop in earnings. 

Latest updates

2 June: Chancellor confirms planned changes to the Coronavirus Job Retention scheme

The Chancellor had already confirmed that the scheme would continue to run until October and that furloughed workers shall continue to receive 80% of wages.

From August onwards, rather than the government meeting the full 80% of a workers wage themselves, employers will be expected to meet some of the costs.

The other main change to the scheme is that from 1 July, employers will have the option of bringing furloughed staff back to work part-time. However, if they do this the employer will have to meet the full costs of your earnings for the hours that you work. Your employer will only be able to claim government help towards your wages for the hours you remain furloughed.

Find out more about the Coronavirus Job Rentention Scheme.

5 May: Furloughed workers won't lose entitlements to Working Tax Credit

Normally someone needs to be working at least 16 hours a week to be eligible for Working Tax Credit. However HMRC have now confirmed that workers who have been furloughed, or those who are on reduced hours due to the coronavirus pandemic, will not lose entitlement to Working Tax Credit so long as they remain employed or self-employed. See the full press release about this announcement.

4 May: HMRC contacts families eligible for Self-Imployment Income Support

The Self-Employment Income Support Scheme offers some self-employed people whose profits are affected by the coronavirus pandemic a grant based on 80% of their average profits, capped at £2,500 per month. The scheme will open to applications on the 13 May and the HMRC has started contacting self-employed people they believe to be eligible, telling them how to make an online claim. You can also check your eligibility for the scheme using a new online tool on gov.uk.

For more information see Self-employed invited to get ready to make their claims for coronavirus (COVID-19) support from gov.uk.

17 April: Council Tax hardship fund guidance

The government has issued new guidance to local authorities on implementation of new £500 million Council Tax hardship fund.

The guidance confirms that the government expects local authorities to use the funding they have been allocated to ensure that all working-age claimants who get a means-tested Council Tax reduction see a further reduction of up to £150 a year.

Any funds remaining after this process can be used 'as local authorities see fit', including to fund their local welfare schemes.

16 April: Universal Credit claimants to verify identity through Government Gateway

The Department for Work and Pensions is allowing new Universal Credit claimants to verify their identify via a Government Gateway Account used within the last 12 months.

15 April: Changes to Statutory Sick Pay entitlement

The government has extended entitlement to Statutory Sick Pay to disabled adults who are deemed to be extremely vulnerable and who have been advised to shield themselves for 12 weeks. It appears that these new rules only apply to adults who themselves are vulnerable and not to carers shielding alongside an extremely vulnerable family member.

4 April: New government guidance on the Coronavirus Job Retention Scheme

New guidance makes clear that those unable to work due to caring responsibilities resulting from Covid-19 can be furloughed by their employer

Originally it was thought that a worker could only be furloughed if there was no work for them to do and not where they were unable to attend their work or other reasons. However, the revised guidance makes clear that this has now been extended to those unable to come to work due to caring responsibilities.

This means that if you are unable to work because you are caring for a child at home or because you are shielding a vulnerable household member, you might be able to get 80% of your wages paid via the Coronavirus Job Retention Scheme.

However, for this to happen your employer needs to agree to furlough you. They cannot be forced to do so if they don't want to. The revised guidance is available on the gov.uk website.

3 April: Recovery of all benefits overpayments, tax credits debts and Social Fund loans paused

To help low income families during the coronavirus outbreak, the Department for Work and Pensions has announced that it is pausing recovering any benefit overpayments, tax credit debts or social fund loans for a three-month period.

You can read the guidance at gov.uk.

This means that those families who are having amounts deducted from their benefits to pay back debts or loans of this nature should soon see these paused, meaning an increase in the benefit payments they receive.

In the majority of cases these deductions will automatically be suspended. However, if you currently make repayments via a bank standing order, bank giro credit or via online banking, you will need to contact your bank to cancel the existing arrangement.

Recovery of Universal Credit advance payments will still continue as normal.

31 March: Voucher scheme launched for schools in England providing free school meals

Children eligible for free school meals in England on the basis their parents are on means-tested benefits will be able to make use of a national voucher scheme, allowing them to continue to access meals whilst they stay at home.

Eligible families in Northern Ireland will be able to get cash payments from the Education Authority Northern Ireland. Local authorities in Wales and Scotland are responsible for supporting eligible families within their area with different councils offering help via money, vouchers, gift cards or food parcels depending on the area.

30 March: Change to Carer's Allowance rules

From 30 March, a break in caring can be ignored in Carer's Allowance claims if it is caused by either the disabled person or their carer having Coronavirus symptoms.

Alongside this, the charity Carers UK say that they have been told by the Department for Work and Pensions that emotional support, such as that provided by telephone or social media, will count as care in assessing if a carer is providing at least 35 hours per week care.

26 March: Support for self-employed workers

The government has announced a new self-employment income support scheme, providing a HMRC grant of 80% of your average monthly profit as calculated over a three year period and with a cap of £2,500 a month.

This will be paid as a one-off lump sum payment in June 2020 and will cover the period March, April and May.

Find out more about the self-employment income support scheme.

Other changes to the benefits system

There have already been a number of changes to the benefits system in response to the current outbreak.

See our page on Covid-19 and welfare benefits for help understanding what financial support you might be eligible for during the coronavirus pandemic. We'll keep this page updated if and when any government changes are announced.