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When do the first cost of living payments get paid out, how much are they and when will they arrive?



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More than eight million households in the UK will get their first cash payment next month designed to help them with the escalating cost of living.

But who is in line to get the first round of government money, how does it arrive and when?

Struggling families will get their first cost of living cash payment in July
Struggling families will get their first cost of living cash payment in July

What is a cost of living payment?

In May the government unveiled a package of measures designed to help everyone with the rising cost of bills and prices.

Every household in England, Scotland and Wales will receive a base payment of £400 later this year which will be added to energy bills in the form of a credit while - additionally - anyone on means-tested benefits will be given a further £650 and pensioners who receive winter fuel payments £300.

Those who are on non-means-tested disability benefits will get an extra payment of £150.

Chancellor Rishi Sunak says around eight million of the most vulnerable households will in total receive at least £1,200 this year – although this does include the £150 council tax rebate many will have already been given.

Every household will be given £400 in energy bill help later this year
Every household will be given £400 in energy bill help later this year

What is being paid next month?

Next month eight million low income households will get the first of their two cost of living instalments, which when added together come to £650.

The first payment, being sent out next month, is for £326. A second instalment of £324 will be sent to qualifying low income households in the autumn.

The payments, say officials, are designed to be deliberately slightly unequal to minimise fraud risks from those who may 'seek to exploit this system' while households who didn't qualify for the first payment can obtain the second if their circumstances have changed.

Money is being paid to those likely to struggle most with the rising bills. Picture: iStock.
Money is being paid to those likely to struggle most with the rising bills. Picture: iStock.

When is the money arriving?

The £326 lump sum, that households won't need to pay back, will begin landing in bank accounts from July 14 and that process will continue until the end of the month and everyone has been paid their money.

Ministers say they hope it will support the groups which are becoming most vulnerable to the rising costs because they don't have the spare income to absorb the rising prices.

Work and Pensions Secretary, Thérèse Coffey explained: "With millions of the lowest-income households soon seeing the first of two cash instalments land into their bank accounts, we are taking action to directly help families with the cost of living.

"This one-off payment totalling £650 is part of our £37 billion cost of living support package that will put an extra £1,200 into the pockets of those most in need."

Rising food and petrol prices are pushing up the cost of living. Picture: Stock photo.
Rising food and petrol prices are pushing up the cost of living. Picture: Stock photo.

Who will receive the £326?

While every household in the UK will be given £400 to put towards the cost of their energy bils in the autumn (on top of the £150 Council Tax rebate that has already been paid) the extra £650 lump sum is reserved for those likely to be struggling the most as we go through this year.

The DWP, which is making the £650 payment in two amounts starting with £326 in July, will pay the money to all households receiving the following benefits: Universal Credit, Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit and Pension Credit.

Payments from HMRC for those on tax credits only will follow shortly after each to avoid duplicate payments.

To be eligible to get this first instalment claimants needed to be in receipt of one of the benefits listed above, or have begun a claim which is later successful, as of May 25 this year.

The eligibility date to be entitled to receive the second instalment - for people whose circumstances might have since changed - will be announced soon alongside payment dates for the additional money being sent to disabled people and pensioners who claim winter fuel payments.

Cost of living payments are tax free
Cost of living payments are tax free

Does the money affect other benefits?

The short answer is no, it won't.

This £326 cost of living payment is designed to give people extra money in their pocket to help pay the bills so it will be tax-free, will not count towards any benefit cap and so will not have any impact on any existing benefits or financial support someone may be claiming.



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