Due lump sum - Universal Credit query

[SweetvalleyByeee]

Hoping someone more mathematically (and Universal-creditally) minded than I can help!

I’m currently in receipt of UC; single parent with one DC living in rented accommodation. It has come to light at work that I am due a chunk of backpay after not being awarded incremental pay rises for the last few years. It amounts to just shy of £4400 gross, after tax I expect I’ll come out with £4720 (ish) if this is paid to me next month along with my (new) normal salary.

My question is, where does this leave me in terms of my UC claim? I will, of course, be well
over the threshold for any UC next month, but does this amount put me in the ‘surplus earnings’ category? If so, will my future months’ UC be affected?

My UC total before adjustments each month is £1509. For the life of me though, I can’t work out how much I am permitted to earn before my UC award reduces to nil, and so I don’t know where the ‘surplus earnings’ rule comes in, if at all for me.

I realise this is rather a fortunate circumstance to find myself in at the moment however, if this payment is going to affect my UC claim (and, therefore, my normal income as I know it) for more than one month, I would like to know in advance so I can budget accordingly.

Many thanks in advance.

Best explanation I've found is here
www.entitledto.co.uk/help/universal_credit_surplus_earnings

If your UC before any deductions for earnings etc is 1509 then you could earn 3098 before UC reduces to 0. So I don't think surplus earnings would apply to you in this case.

Do you need the cash? Could you
put it into your pension?

Thank you so much!! I have read the guidance online over and over but couldn’t work out what I could earn prior to it reducing to zero at all. You’re a diamond 💎

I got £3087 (net)

Work allowance £344

55% of £2743 = £1509

Thanks for your reply! It’s a good question and, in all honesty, isn’t something I’d considered. At the moment my savings leave quite a lot to be desired so it’d be a welcome boost, particularly with everything going on with the economy. I’m very much expecting an increase in my rent as soon as my current tenancy agreement is up 😕

I’ll not argue either way, I’m just grateful for the input. Thank you 😊

Yes you're correct sorry. I mistyped work allowance as 355!

If you have under £6k in savings you should most definitely save as much of it as you can (and not put it in your pension as PP suggests).

Also re end of fixed term tenancy and potential rent increase, see
england.shelter.org.uk/housing_advice/private_renting/options_when_your_fixed_term_tenancy_ends
and
england.shelter.org.uk/housing_advice/private_renting/rent_increases

Again, thanks so much! I have been reading up on rental agreements but, unfortunately, I don’t think I’ll have too much to go on. I’m lucky to live in a great area in which rentals are snapped up before they’re even officially advertised. If I were to object to the inevitable hike, the landlord would easily find a new tenant, and I’d be left with no choice but to have to move to a less desirable location (with, no doubt, worse schools) for probably not much less each month. He well and truly has me over the proverbial barrel!