The maximum amount of deductions that can be taken from a universal credit award has been reduced from 40% to 30 per cent of the standard allowance(except for last resort deductions). Click here for the guidance.
'There is an overall maximum percentage rate for all debts and deductions that can be taken from a Universal Credit payment. The maximum amount that can be deducted is an amount equivalent to 30% of the claimant’s Universal Credit standard allowance.
There are 2 exceptions to this rule, Last Resort Deductions (arrears of housing and fuel) and ongoing monthly costs for utilities (gas, electricity and water) where there are also arrears being taken for them.
Overpayments are repaid at a rate of up to 15% of the standard allowance. If one or both of the claimants’ (if they are a couple) earnings are above the level of the work allowance (if the work allowance is applicable) an additional amount of up to 10% more can be deducted.
If a claimant has intentionally provided DWP with incorrect information (fraud) overpayments are repaid by deducting up to 30% of the Universal Credit standard allowance.
If the Universal Credit claim is a joint claim (a couple claiming together) they will receive a single monthly Universal Credit payment for the household. If either one of the claimants has debts or deductions, they will be taken from the single monthly payment.' and
'There is a priority order for deductions in Universal Credit. It will only be applied if the total deductions would otherwise be more than 30% of the claimant’s Universal Credit Standard Allowance.
However, the following deductions are taken before the priority order is applied (in order of precedence):
1 Fraud penalties
2 Sanctions
3 Short term Advance (Universal Credit Advance - taken out at the time of a new claim or a change of
circumstances)
4 First Month Advance (Universal Credit Advance – taken out at the time of transfer from another benefit)
5 Budgeting Advance '
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