First tax credits Cost of Living instalment paid

The first instalment of the £650 Cost of Living Payment for people receiving Child Tax Credit and/or Working Tax Credit was paid in September 2022, according to the Law Centre Northern Ireland¹. The payment is made automatically through existing benefit awards, and there is no need to claim¹.

Recipients of Child Tax and/or Working Tax Credit are paid £650 in two instalments¹. The first instalment was in September 2022, and to be eligible a person must have received a payment, or an annual award of at least £26, of tax credits on any day between 26 April and 25 May 2022¹. The second Cost of Living Payment for people on tax credits will be paid at the end of November 2022, and eligibility for that instalment requires a payment, or an annual award of at least £26, of tax credits on any day between 26 August and 25 September 2022¹.

Where a household is paid both Child Tax Credit and Working Tax Credit, it receives only one £650 payment, paid in two instalments¹. Couples who make a joint claim for tax credits receive one £650 payment between them, also paid in two instalments¹.

The tax credit timetable differs from that for means-tested benefits. Recipients of means-tested benefits, including Universal Credit, Pension Credit, income-based Jobseeker's Allowance, income-related Employment and Support Allowance and Income Support, receive £650 paid in two instalments¹. The first payment of £326 was made in July 2022 to anyone awarded, or later found entitled to, one of those benefits on any day during the period 26 April to 25 May 2022¹. The second payment of £324 will be paid in November, and to get it a person must have been entitled to a payment, or later found entitled to a payment, of income-based JSA, income-related ESA, Income Support or Pension Credit for any day in the period 26 August to 25 September 2022¹. Couples making a joint claim for a means-tested benefit receive one £650 payment between them, in two instalments¹.

Separately, a lump sum of £150 was paid to anyone in receipt of a qualifying disability benefit on 25 May 2022, and the payment should have been made in September¹. Qualifying benefits are Attendance Allowance, Constant Attendance Allowance, Disability Living Allowance, Personal Independence Payment, and Armed Forces Independence Payment and War Pension Mobility Supplement¹. Someone paid a means-tested benefit or tax credit and a qualifying disability benefit receives the £150 in addition to the £650¹.

Why it matters for households

The September instalment reached households whose only qualifying award was tax credits, a group paid on a different timetable from those on means-tested benefits, who received their first £326 in July¹. For a couple with a joint tax credit claim, the £650 is one payment between them rather than one each¹. The payments are made automatically through existing awards and do not affect entitlement to benefits or count towards the benefit cap¹. People who only receive Carers Allowance, new-style or contribution-based JSA, new-style or contribution-based ESA, Incapacity Benefit, or Industrial Injuries Disablement Benefit are not covered by a specific cost of living support payment¹.

What happens next

The second Cost of Living Payment for people on tax credits will be paid at the end of November 2022¹. From November 2022, anyone entitled to the Winter Fuel Payment for winter 2022 to 2023 will receive an additional £300 towards the cost of energy; eligibility requires being over state pension age, 66 or above, between 19 and 25 September 2022¹. The Cost of Living Payments guide sets out what was paid and when, and the benefits hub covers related entitlements including Pension Credit.