Divorcing or separating from your husband, wife or partner can be an emotional and upsetting time and sorting out your finances often adds to the stress, especially if you’re worried about how you’ll make ends meet on your own.
It’s not uncommon for people to find themselves in a financially precarious position following a divorce or separation, often as a consequence of decisions made as a couple during their relationship, such as one partner stopping work to bring up children.
If you’re worried that your divorce will leave you struggling financially, you are not alone and you may qualify for a number of benefits.
Here, we explain which benefits you might be able to claim and how to find out if you are eligible. You can find out more about separating your financial affairs in our article Sorting out your finances when a relationship ends.
What benefits might I be entitled to if I’m divorced or separated?
Below we list some of the most common benefits that you may be able to access if your income has fallen due to separation or divorce from your husband, wife or partner. If you’re already claiming any benefits, then as with any other changes to your circumstances, it is essential that you notify the Jobcentre Plus and the HMRC of your separation or divorce as soon as possible.
Anyone between the ages of 18 and State Pension age who applies for benefits will now be applying for Universal Credit, which is a payment to help with your living costs. Coming into full force in December 2018, Universal Credit has replaced a number of separate legacy benefits, including:
- Child Tax Credit
- Housing Benefit
- Income Support
- income-based Jobseeker’s Allowance (JSA)
- income-related Employment and Support Allowance (ESA)
- Working Tax Credit
If you are currently receiving the above benefits or tax credits, you will continue to be able to claim them, but new applicants will only be able to apply for Universal Credit.
Universal Credit is paid monthly or twice a month for some people in Scotland. If you live in Northern Ireland, there is a different process you will need to go through via Universal Credit in Northern Ireland. If you are over 18 and are living in the UK, you may be eligible if:
- You are on a low income or out of work
- You are under State Pension age (if you are State Pension age you may be eligible for Pension Credit – you can read more about this in Pension Credit Explained)
- You have £16,000 or less in savings
Universal Credit is calculated in three steps:
1). Your household’s maximum Universal Credit amount is worked out. If you are eligible for Universal Credit, you will be given the Standard Allowance, which for a single person over 25 is currently £409.89 per month (an increased rate due to the pandemic – this will go down to £324.84 in October 2021). You may also be eligible for certain additional elements which will supplement the total amount you receive, dependent on your situation. These include: housing element, child element, disabled child element, disabled child element, limited capability for work and work-related activity element and carer for a severely disabled person element.
2). Your earnings, income and money from savings are taken into account: Money may be taken off the maximum amount depending on your income. Any savings between £6,000 and £16,000 will mean you receive a reduced Universal Credit amount.
3). Deductions are made: money may be taken out of your Universal Credit entitlement, before it reaches your bank account to:
- pay back any advances or loans you have taken out
- pay back any debt or overpayment on other benefits
- pay your utility bills direct to the provider
- for child maintenance payments (if arranged through Child Maintenance Service)
There is a limit on the amount you can receive through benefits, known as the Benefits Cap and you may find that in claiming Universal Credit, you hit this cap. In Greater London the maximum you can receive through benefits is:
- £442.31 per week (£23,000 a year) if you’re a single parent and your children live with you
- £296.35 per week (£15,410 a year) if you’re a single adult
Outside of Greater London, these amounts are:
- £384.62 per week (£20,000 a year) if you’re a single parent and your children live with you
- £257.69 per week (£13,400 a year) if you’re a single adult
Determining exactly how much you may be eligible for is a complicated process, so it is best to seek professional help, for example from your local Citizens Advice, if you need help with your claim.
For further information on Universal Credit, have a look at our guide to Everything you need to know about Universal Credit.
Job Seekers Allowance (JSA)
The new style JSA can be claimed in addition to Universal Credit, and can help support you while you look for work, or are receiving a lower income. If you are eligible and are over 25, you may be able to claim up to £74.35 per week for a maximum of 182 days (approximately 6 months). This amount will be in addition to your Universal Credit entitlement.
To be eligible for the new style JSA you need to have worked as an employee and paid sufficient Class 1 National Insurance contributions usually in the last 2 to 3 years (National Insurance credits can also count). Class 1 National Insurance contributions mean that while you were employed, you were earning more than £183 a week and were under State Pension age. These contributions are usually automatically deducted by your employer. National Insurance credits are also acknowledged by the new style JSA.
In addition to taking reasonable steps to find employment, you will also need to:
- be 18 or over
- be under the State Pension age
- not be in full-time education
- be available for work
- not be working at the moment, or be working less than 16 hours per week on average
- not have an illness or disability which stops you from working
- live in England, Scotland or Wales
- have the right to work in the UK.
Employment and Support Allowance (ESA)
If you have a disability or health condition that affects how much you can work, you may be eligible for ESA. If you are eligible and are over 25, you may be able to claim up to £74.35 per week. The length of time you can receive this support will vary, and depends on your particular medical condition and the group you are placed into when you apply, but will range from 365 days to continuous. Similarly to the new style JSA, ESA will be paid in addition to your Universal Credit entitlement.
To be eligible for ESA, you will need to have worked as an employee and paid sufficient Class 1 National Insurance contributions usually in the last two to three years (National Insurance credits can also count). Class 1 National Insurance contributions mean that while you were employed, you were earning more than £183 a week and were under State Pension age. These contributions are usually automatically deducted by your employer. National Insurance credits are also acknowledged by the new style ESA.
Council tax reductions
Full Council Tax bills are based on two adults living in a home, so if your new situation means you will be the only adult in your home, you should be eligible for a 25% reduction on your bill. If you’re on a particularly low income, or are receiving certain benefits, you may be able to claim for a Council Tax Reduction which could reduce your bill by as much as 100%, depending on your circumstances. The support available varies from council to council so it’s worth contacting your local council to find out what help they can provide – you can find their contact details here.
Child benefit: Who gets child benefit after divorce?
If you are responsible for bringing up a child under the age of 16, or under 20 if they’re in approved education, you may be eligible for child benefit. You will be able to claim £21.05 per week for your eldest or only child, and £13.95 a week for any subsequent children.
Only either your ex-spouse or you are able to claim child benefit for each child, so if you are taking the majority of the responsibility for your child, you should be receiving the benefit. If your ex-husband or wife was previously receiving the benefit, they will need to contact HMRC to stop further payments and you will need to submit a new claim.
Will child maintenance payments affect my benefits?
Both you and your ex-partner are expected to contribute towards the cost of bringing up your children, and if your children live with you, it is likely you will be receiving some sort of child maintenance payment, either through a family-based arrangement or through the government’s Child Maintenance Service. Child maintenance payments are not classed as income so will not impact your ability to claim any of the benefits you get.
If you have to pay child maintenance while on benefits
If you are the parent paying child maintenance and you receive certain benefits, you will be required to pay £7 a week out of your benefits if arranged by the Child Maintenance Service. If you can agree to a family-based arrangement, you and your ex-partner will determine how much you will pay.
You should always report your child maintenance arrangements when making a benefit claim, even if you don’t think it will affect anything.
Help paying court and legal fees when you separate
If you are the one filing for divorce from your husband or wife, you are usually the one who must pay the £550 application fee. If you are struggling to pay court or legal fees, you may be eligible for assistance in paying these fees. Find out more at Gov.uk.
Where to go for more help
There are several charities and organisations which can advise you about any benefits you might be entitled to if you are divorcing or separating and may be able to help you submit a claim.
These include Turn2us, which can assess your eligibility for benefits through its Turn2us benefits calculator or by phone on 0808 802 2000. The site Entitledto.co.uk also has a free benefits calculator which you can use to see what you qualify for. Policy in Practice also has a benefits and budgeting calculator to show you how much you are eligible for, how earning may impact your budget and how changes in your household budget can affect your income.
Alternatively, you can get help from Citizens Advice. You can search for your local Citizens Advice here or you can telephone their customer service helpline on 0344 411 1444.
Have you recently made a benefits claim for the first time or do you have any tips for those applying for Universal Credit? If so, we’d be interested in hearing from you. You can join the money conversation on our Rest Less community forum, or leave a comment below.