Attachment of Benefits or Deduction of Benefits
What is an attachment of benefits, and how do they work?
There are two types of attachments of your income that can be requested to deduct:
- Attachment of benefits
- Attachment of earnings
The Department for Work and Pensions (DWP) can deduct money from your benefits and pay it to a creditor or supplier for outstanding debts such as:
- Council Tax arrears
- Fuel costs arrears
- Rent and service charge arrears
- Gas and Electricity arrears (Fuel Direct Scheme)
- Water bill payment and arrears (Water Direct Scheme)
- Court fines
After an order is granted, deductions can be taken as an attachment of benefits from benefit income, such as:
- Employment and Support Allowance (ESA)
- Income Support (IS)
- Jobseeker’s Allowance (JSA)
- Pension Credit Guaranteed Credit (PCGC)
- Universal Credit (UC)
The attachment of benefit can only happen if the person whose name appears on the bill receives one of the above benefits.
The Department for Work and Pensions will pay the deduction to the council monthly until the debt is cleared.
If you’ve had a benefit overpayment:
You can get an attachment of benefits, which means you could get less in your benefits payment each month until you pay it back. In most cases, the Department for Work and Pensions (DWP) will reduce your cost by between 15% and 25% of your ‘standard allowance’ – this is the basic amount you get, not including extra amounts called ‘elements’.
If you don’t have enough to live on:
You can ask for a reduced attachment of benefits with your Universal Credit if it being reduced means you don’t have enough money to live on. You might have a Universal Credit attachment of benefit for:
- a benefit debt
- a Social Fund loan
- rent arrears
You’ll need to show the DWP that you don’t have enough to live on – financial hardship. You’ll need to give them a financial statement showing your income and what you spend your money on. You’ll also need to show you can’t meet your basic living costs with the current deduction rate. You can send this information through your online journal or in a letter if you don’t have an online account & this can sometimes reduce the attachment of benefits.
If you think your attachment to benefits is wrong:
You should call the Universal Credit helpline or ask for a reason or by using your online account if you have one.
You should do this if:
- your payment is less than you expected, and you haven’t been told why
- you think there’s been a mistake with how your Universal Credit has been worked out
Provide any evidence you have:
It’s a good idea to give them some evidence of the mistake to try and stop the attachment of benefits. You’ll need to do this through your online account if you have one or by letter. Evidence could be, for example:
- your tenancy agreement – if you think your housing costs are wrong
- payslips or bank statements – if there’s been an error in your earnings (ask your employer for payslips if you don’t have them)
- childcare bills – if they have your childcare costs wrong
If you still disagree with the attachment of benefits
If the DWP gives you an explanation and you disagree with the decision, you can challenge it – this is a mandatory reconsideration.
Can a debt solution stop an attachment of benefit?
Yes, suppose you owe enough debt, qualify, and enter an insolvency solution such as a Debt Relief Order (DRO) or an Individual Voluntary Arrangement (IVA). In that case, your debts can be included, and you will begin to receive your total benefit award.
What is Universal Credit?
Universal Credit is a means-tested benefit in the UK that provides support to people who are on a low income or who are out of work. The amount of Universal Credit you receive can be reduced (deducted) if you have certain types of income or savings.
Here are some common things that may be deducted from your Universal Credit payment:
- Earnings: If you’re in paid work, a portion of your earnings may be deducted from your Universal Credit payment. This is known as the “work allowance” and is based on your personal circumstances, such as whether you have children or a disability. The work allowance is the amount of money you can earn before your Universal Credit payment starts to be reduced. For example, if your work allowance is £198 per month and you earn £300, £102 of your earnings will be deducted from your Universal Credit payment.
- Other benefits: If you’re receiving other benefits, such as Pension Credit or Housing Benefit, these may be taken into account and deducted from your Universal Credit payment. This is because Universal Credit is designed to replace a number of other benefits and tax credits, so you can’t receive the same support from both Universal Credit and the other benefit at the same time.
- Savings: If you have savings over £16,000, this may affect the amount of Universal Credit you receive. For every £250 (or part of £250) you have over £16,000, your Universal Credit payment will be reduced by £4.35 per month. This is to encourage people to use their savings before claiming benefits.
- Rent: If you’re a tenant and receive help with your rent, this may be deducted from your Universal Credit payment. This is because Universal Credit is designed to replace Housing Benefits, so you can’t receive the same support from both Universal Credit and Housing Benefits at the same time. The amount of rent support you receive from Universal Credit will depend on your household size, your income, and the rent you pay.
- Repayments: If you owe money to the government or another creditor, this may be deducted from your Universal Credit payment. This can include things like overpaid benefits, tax credits, student loans, or council tax arrears. The amount that is deducted each month will depend on the size of the debt and the repayment plan you have agreed with the creditor.
- Sanctions: If you fail to comply with the requirements of your Universal Credit claim, such as not actively seeking work or failing to attend job centre appointments, your payment may be reduced as a result of a sanction. Sanctions can last for a set period of time, such as four weeks, and can result in a significant reduction in your Universal Credit payment.
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Which Debt Plans apply to you?
We assess your circumstances based on your individual circumstances and will assess for all available debt advice solutions.
Please find below a list of debt solutions we will evaluate for:
- Debt Management Plan (DMP) – Information on a debt management plan
- Individual Voluntary Arrangement (IVA) – Information on an IVA
- Debt Relief Order (DRO) – information on a DRO
- Bankruptcy – information on Bankruptcy
If you have used our online application form, we will contact you to run through your income and outgoings and discuss your options so you can make an informed choice. At Debt Support Direct, we offer all statutory debt solutions in England, Scotland, Wales, and Northern Ireland so that you can choose the debt solution tailored to you and your circumstances.
If you have an attachment of benefits and have chosen the debt solution that you feel is the most appropriate, there will be some paperwork to fill in to put the debt solution programme in place.
Our debt advice is free, non-judgmental, and friendly, so if you are struggling with debt, speak to one of our experienced debt experts for a confidential chat on 0161 549 9848.
Free and impartial money advice is available from the Money Helper, an organisation set up by the Government for people in debt.
Debt Support Direct does not administer any debt solutions; we will assess your debts, circumstances and affordability and signpost you to an organisation or charity that can set up and help the debt plan you decide suits your circumstances.
All debt solutions should be very carefully considered. Some providers may charge fees if a solution is taken; if applicable, these will be outlined during your consultation.
Your ability to obtain further credit in the short term will likely be affected, which may also be the case over the medium to long term. Calls from mobile phones and other networks may be charged to our free phone number.
The Financial Conduct Authority regulates Ruby Holdings Limited, trading as Debt Support Direct. We can offer debt advice for both formal and informal solutions. All debt solutions must be carefully considered, and you must take independent advice.
There are sources of free debt advice and services. You can find out more by contacting the Money Helper on 0800 138 7777 or visiting moneyhelper.org.uk
Here are some links to UK debt charities that can provide help and advice on managing debt:
Please carefully read the information on these websites to understand what services they offer and if they would fit your needs. Reaching out for help as soon as you start having difficulties managing your debts is important. These organisations can help you understand your options and work with you to develop a plan to get back on track.