Reducing Universal Credit deductions

Yes, you can ask the DWP to reduce deductions from your Universal Credit, and in many cases they are required to consider your request seriously. Here is the position.

Background:

The DWP can make deductions from your Universal Credit for a range of reasons, including repayment of benefit overpayments, budgeting advances, third party deductions for rent arrears, fuel debts, council tax arrears, and sanctions or fraud penalties. These deductions are governed by the Universal Credit Regulations 2013, in particular regulations 58 to 72 and Schedule 6.

Maximum deduction cap:

There is a cap on the total amount that can be deducted from your standard allowance. As of April 2024, the normal maximum rate of deductions is 25 per cent of your standard allowance for most debts. For certain priority debts such as fraud overpayments or sanctions, the cap can be higher. Where multiple deductions are being taken, they must not together exceed the applicable cap unless there are specific exceptions.

Your right to ask for a reduction:

You have the right to contact the DWP and ask them to reduce the rate at which deductions are being taken. This is sometimes called an "affordable repayment" request. The DWP should take into account your financial hardship and individual circumstances when deciding the rate of deduction.

In practice, the DWP can agree to reduce deductions to a lower percentage, and in some cases they can reduce them to as low as 5 per cent of the standard allowance for certain debt types, particularly benefit overpayments and budgeting advance repayments. However, some deductions such as those for ongoing housing costs, child maintenance, or court fines have less flexibility.

How to do it:

1. Call the Universal Credit helpline on 0800 328 5644 or contact them through your UC journal.
2. Explain clearly that the current level of deductions is causing you financial hardship and ask for them to be reduced.
3. Be prepared to explain your essential outgoings and why the deductions are unaffordable. It can help to have a simple income and expenditure breakdown ready.
4. If the person you speak to says they cannot help, ask for the decision to be reviewed by a decision maker.

If the DWP refuses:

If the DWP refuses to lower deductions and you believe the decision is wrong, you can ask for a mandatory reconsideration. If that is unsuccessful, you may be able to appeal to the First-tier Tribunal (Social Entitlement Chamber), depending on the type of deduction. Not all deduction decisions carry a right of appeal, so this depends on the specific circumstances.

You can also complain through the DWP complaints procedure, and ultimately to the Independent Case Examiner or the Parliamentary and Health Service Ombudsman via your MP.

Additional help:

If you are struggling with deductions, organisations such as Citizens Advice, Turn2us, and local welfare rights services can help you challenge or negotiate the level of deductions. They may also be able to identify whether any of the deductions being taken are unlawful or being applied at too high a rate.

One important point: if you are in genuine financial hardship and deductions are leaving you unable to afford essentials such as food and heating, make sure you say this explicitly when you contact the DWP. The word "hardship" matters because it triggers a specific consideration process.