Universal Credit is a state benefit designed for UK citizens who are low on income or out of work so that they are financially supported to pay for their living costs. In cases where the reason for claimants being out of work is a health condition or disability, the element of the limited capability of work can be. Through this blog post, we will explore the different factors that affect the limited capability for work element for Universal Credit, the reasons for a waiting period once an applicant’s claim has been assessed, situations in which a waiting period does not apply. We will also gain a holistic view of how Universal Credit can be benefitted from and the obligations of claimants.

Does Limited Capability For Work On Universal Credit Get Backdated?

Yes, the Limited Capability for Work element that eligible candidates claim on Universal Credit can be backdated for up to three months. The reason for this is the Work Capability Assessment (WCA) that evaluates an applicant’s claim that their health condition or disability prevents them from performing work-related tasks. There is a three-month waiting period for the WCA to be confirmed. 

Once their claim is approved, the Department for Work and Pensions (DWP) will compensate claimants for this period by providing a three month backdate of payments for the limited capability for work element on Universal Credit. If due to any reason, the WCA takes more than three months to be confirmed, the DWP will clear backdated payments up to that point in time.

The DWP will carry out a Work Capability Assessment to provide evidence in support of their claim. If an applicant has been unable to work for 4 weeks due to a health condition or disability, they will be referred for a WCA on the 29th day. The assessment can either be carried out in person or through a phone/video call. It generally takes around three months from your WCA to the time that the DWP reaches a decision regarding your LCW claim.

During this time, 

  • applicants of new claimants will receive the standard allowance
  • claimants continue getting the same universal credit amount if they are reporting WCA due to a change of circumstances

However, if applicants of LCW fall into any of the below categories, they will not be required to undergo a WCA:

  • the claimant’s age qualifies them to receive a state pension
  • the claimant is receiving Attendance Allowance. Personal Independence Payment (PIP) with the enhanced daily living component of Disability Living Allowance (DLA) with the highest rate care component.

The waiting period for WCA will not apply under the following conditions:

  • the claimant is are terminally ill
  • the claimant is part of a work-related activity group or support group due to their Employment and Support Allowance and is being moved over to Universal Credit
  • the claimant was in the work-related activity or support group a day before their Universal Credit award began but it was stopped due to rules about time limiting
  • if the claimant was previously awarded an LCW but either they stopped being a couple or become a couple
  • the claimant had already begun their waiting period through a previously awarded LCW claim

Once approved, the LCW element will add £343.60 each month to your previous UC claim.

What Is A Work Capability For Assessment?

If your Universal Credit claim is based on medical conditions that prevent you from working, you will be asked by the DWP to provide evidence for such a claim and undergo an assessment process. This is termed as a Work Capability for Assessment (WCA) and its purpose is to confirm the medical or disability claim made by applicants of Universal Credit.

During the assessment, applicants will be asked questions (in person or through a video call) regarding their health and how their conditions impact not just their ability to work but also to perform everyday chores.

After this assessment, a WCA form or a UC50 is sent to applicants who will fill in the required information before posting the completed form to the Centre for Health and Disability Assessments (CHDA) by the date requested.

After your form has been assessed, the Centre for Health and Disability Assessments will send their feedback report to the Universal Credit department at the Department of Work and Pensions. On the basis of your WCA, a decision will be made regarding whether you are fit to work, may be granted limited capability for work or will be assigned limited capability for work and work activity.

When Do I Tell Universal Credit I Have A Job?

You should inform the Department for Work and Pensions immediately when you have a job, an increase in pay or any other change in circumstances that affect your eligibility criteria or the scale of payments that you receive in the form of Universal Credit (or any other state benefit). 

In case of finding a job, you are required to provide the below information to the DWP:

  • who your employer is 
  • the date when the job will start 
  • the date by when your pay will increase

It is understandable that with a rise in income, you will face a reduction in your benefits. In the case of Universal Credit, for every £1 that you (or your partner earn), 55p will be counted as income during your Universal Credit calculation. While communicating a change to the DWP, you should state your disposable income in such cases, which is the take-home amount after your deduction of taxes, NIC and pension fund from your gross income.

If you or your partner have to take care of a child and one of you have limited capability for work, you may be able to claim a work allowance despite one of the partners having a job. However, if you were taking the help of Universal Credit to pay mortgage interest payments, you will lose that claim once you get a job.

If claimants are found to have hidden such information deliberately from the authorities, they may face a penalty, the amount may be recovered later on or they may be even be taken to court.

If claimants deliberately refuse a job or an increase in pay to avoid benefits reduction despite agreeing to it in their claimant’s commitment, they may be sanctioned by the Department for Work and Pensions. This means that their Universal Credit payments will be temporarily reduced.

It must be kept in view that your Universal Credit payment does not automatically stop when you get a job. You will continue to receive the benefit, however, the amount will be reduced depending on your wages.

If you lose your job due to any valid reason(s), you will be able to reclaim your previous Universal Credit amount.

Which Change In Circumstances Affect Universal Credit?

Certain changes in your circumstances can bear an impact on the benefits you receive including Universal Credit. If you hide such facts from the authorities with the intention to avoid a reduction in your benefits, you may be penalised or taken to court. Therefore, it is advisable if you face any of the following situations, you must inform the relevant authorities by signing in to your Universal Credit account

  • a new mobile number, postal or email address
  • a change in your bank details
  • change of residence due to moving in with a partner
  • having a child
  • changes to your health condition
  • being unable to work due to an illness
  • starting to care for a child or disabled person
  • finding or finishing a job
  • changes to your earnings, savings, investments
  • changes to rental payments
  • changes to your immigration status (in case you’re not a British citizen)

What Counts As Income For Universal Credit?

During your benefits calculation by the DWP, not only is your job-related income(s) taken into account, but the authorities will also consider unearned incomes. These are incomes that individuals receive without having to work.  

Unearned incomes that affect your Universal Credit payments include the following:

  • Jobseeker’s Allowance (new style)
  • Employment and Support Allowance (new style)
  • Pension Income
  • Carer’s Allowance
  • State benefits that aren’t replaced by Universal Credit

For every £1 earned through any of the above means, £1 will be reduced from your Universal Credit payments.

However, the following unearned incomes do not count towards Universal Credit calculations:

  • Child Benefit
  • Child Maintenance Payments
  • Disability Living Allowance
  • Personal Independence Payment
  • Income From Boarders And Lodgers.

Conclusion:

When applicants apply for Universal Credit with an additional claim of having limited capability for work, they need to undergo a fitness for work-related health assessment by the DWP which may take up to three months to confirm the applicant’s eligibility. Should their claim be approved, claimants will be able to receive their Limited Capability for Work allowance with a backlog of three months. However, should their health improve and they are fit for work, claimants are expected to inform the DWP or UC of this change to avoid claim fraud.

FAQs: Does Limited Capability For Work On Universal Credit Get Backdated?

Do they back pay limited capability for work?

Yes, the Limited Capability for Work element that eligible candidates claim on Universal Credit can be back paid for up to three months. The reason for this is that the Work Capability Assessment that evaluates an applicant’s claim that their health condition or disability prevents them from performing work-related tasks takes three months to be confirmed. 

How much is the limited capability for work element of Universal Credit?

Once approved, the LCW element will add £343.60 each month to your previous UC claim. Since the amount is generally received by claimants after a three month waiting period, they can expect the first payment to include a three-month backlog of the given amount.

What does limited capability mean on Universal Credit?

Limited capability for work means that the claimant is unable to perform work-related tasks due to a health condition or disability and is not expected to look for work at the moment. However, they are expected to prepare for work as soon as their condition improves. Limited capability for work and work-related activity means that the claimant is not fit to work and is not expected to look or prepare for work anytime in the future as there is a lack of possibility that their condition will improve. 

How long does it take to get limited capability for work?

It generally takes three months from the time of a claimant’s Work Capability Assessment to the time that a decision is made regarding their eligibility for limited capacity to work.

How long does it take for UC50 to make a decision?

It generally takes three months from the time of a claimant’s Work Capability Assessment to the time that a decision is made regarding UC50; their eligibility for limited capacity to work.

References:

Health conditions, disability and Universal Credit – GOV.UK

Universal Credit: Health conditions and disability guide – GOV.UK

Universal Credit Limited Capability for Work

Long-term health condition or disability

Does limited capability for work get backdated?

Universal Credit: Report a change of circumstances – GOV.UK

Getting a job and Universal Credit

Understanding Universal Credit – How earnings affect Universal Credit

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.