Moving from ESA to UC
This will depend upon your circumstances and the other benefits you are receiving.
The move to UC affects people receive income-related (IR) ESA and/or the other legacy benefits, which are: Housing Benefit, Income Support, income-related Jobseekers Allowance, Child Tax Credit and Working Tax Credit. If you receive Contribution-Based (CB) or New-Style ESA, this will continue and is not affected by Universal Credit. If you receive CB-ESA or New-Style ESA, you would only be asked to migrate to Universal Credit if you are receiving other legacy benefits – the ESA you receive would not be affected.
If you receive IR-ESA your circumstances do not change, then you can remain on your current legacy benefits until you receive a formal ‘migration notice’ from the DWP, which will give you a deadline by which you have to claim Universal Credit. Even if you decide not to claim, your existing legacy benefits will still stop. You can decide to voluntarily move to UC earlier if you want to (for example, if you would be better off).
At the time of writing, the time frame for managed migration of IR-ESA claimants to UC is as follows:
- If you receive IR-ESA with Child Tax Credit (with or without Housing Benefit) – you will receive your migration notice from July 2024
- If you receive IR-ESA on its own or with Housing Benefit (but no Child Tax Credit) – you will receive your migration notice from September 2024. Previously, this group were not expected to migrate until 2028/29 but the Government announced in April 2024 that this would be brought forward.
The DWP have stated that they hope to complete the process of sending migration notices to all legacy benefit claimants by December 2025.
However, in the meantime, if your circumstances change in a way which would previously have resulted in you making a new claim for one of the legacy benefits that UC replaces, then you will need to claim UC instead. At this point, your entitlement to ESA and any other legacy benefits and tax credits will end. This is a process called "natural migration".
The DWP has been encouraging people to move to UC, known as 'voluntarily migration'. You may be better off doing this but, be warned, if you end up worse off you will not be entitled to transitional protection, whereas you would be if you are subject to managed migration.
What is Universal Credit natural migration
If you have a change of circumstances that would usually lead to a claim for a different or additional “legacy” benefit, you may have to apply for UC at that point. This is called “natural migration” and some examples include: -
- You move from work to unemployment or reduce your working pattern to less than 16 hours per week. Previously, you may have claimed income-based JSA, so you will now need to claim UC.
- You move from unemployment to employment or self-employment. Previously you may have claimed Working Tax Credit, so you will now need to claim UC.
- You are employed and experience sickness or a disability which means you are unable to work. Previously you may have claimed income-related ESA, so you will now need to claim UC.
- You become responsible for a child for the first time. Previously you may have claimed CTC, so you will now need to claim UC. If you are already claiming WTC, you do not need to claim UC, as you have an existing Tax Credit claim in place and so it is not a new claim. However, the Tax Credit system will close completely at the end of the 2024/5 financial year and so this rule will no longer exist after that point.
- You receive Housing Benefit and move from one local authority to another. Previously you may have made a fresh HB claim in the new area, so you will now need to claim UC.
- You receive Income Support but are no longer a carer or lone parent of a child under 5 so your entitlement to IS ends. Previously, you may have claimed income-based JSA, so you will now need to claim UC.
- If you were claiming as part of a couple and are now single or were claiming as a single person and are now part of a couple – you may need to move to UC at this point, depending on your circumstances (and those of your partner if you are forming a couple).
If you apply for UC due to natural migration, then any Tax Credits you receive will stop straight away. If you are receiving IR-ESA, Housing Benefit, Income Support or income-based Jobseekers Allowance you will continue to receive these benefits for two weeks after you make your UC claim.
If you move via natural or voluntary migration, your household income, savings and circumstances will be assessed under the new means-tested criteria for UC and you will not receive a transitional element if you will be worse off under UC, as this only applies when you move via managed migration.
It should be noted, however, that there are some transitional protections that do apply if you move to UC via natural or voluntary migration:
- If you were receiving a ‘severe disability premium’ within your IR-ESA, IS or IB-JSA - you may qualify for an SDP transitional element when you move to UC. The rate you would receive will depend on your personal circumstances.
- If you were receiving an SDP and were receiving IS, IB-JSA, IR-ESA or Child Tax Credit that included an enhanced disability premium, disability premium, disabled child premium or lower-rate disabled child element – you may be entitled to additional transitional protection to make up for the loss of these elements when you move to UC.
What is Universal Credit managed migration?
Managed Migration is the process of the DWP moving people form legacy benefits to UC and it is expected that all legacy benefits will receive their ‘migration notice’ asking them to claim UC by December 2025.
The migration notice will give you at least 3 months in which to make a UC claim – this is called your ‘deadline day’. If you make a UC claim before your deadline day, your Tax Credits will stop from the day before your UC claim, but any other legacy benefits will continue to ‘run-on’ for two further weeks after the date of your UC claim. If you are worse off on UC than you were on your legacy benefits, you should receive a ‘transitional element’ to make up the difference.
If you don’t make a claim by your deadline day, your Tax Credits will stop with effect from the day before deadline day. Any other legacy benefits will continue to ‘run-on’ for two weeks and will then stop. If you do then make a claim before your ‘final deadline day’ (which is one month from your deadline day) then you will still be entitled to the transitional element if you are worse off on UC.
If you do not make a claim by your final deadline day, you will not be entitled to the transitional element. This is the case even if you claim after your deadline day and ask for your claim to be backdated to a day that falls before your final deadline day.
Will I be worse off on UC
If you move to UC via natural or voluntary migration, you may be worse off. This is because you would not be entitled to a transitional element if your UC is less than you were receiving on legacy benefits.
If you move via managed migration, the intention is that you will not be worse off at the point when you make your claim, as the transitional element should make up the difference.
However, the transitional element ‘erodes’ if new elements (other than the childcare element) are added to your UC claim after the first assessment period. It also erodes when benefit rates rise, which usually happens each year in April.
For example:
- Josh’s UC award includes a transitional element of £200 per month. In April, UC rates increase so the other elements of Josh’s award increase by £50 per month. Josh’s transitional element would erode by £50 because of this so he would not be better off. This means that, over time, you may eventually be worse off than if you had stayed on legacy benefits.
- Magdalene and her husband David moved to UC from IR-ESA. They had transitional protection of £100 included in their claim. Two months after they started to receive UC, Magdalene successfully claimed PIP and Dave reported that he is her carer. The carer element of £198.31 would ordinarily be added to their claim. In their case, this cancels out their transitional element of £100. Their award would not longer include the transitional element, but the actual amount of money they receive would only have increased by £98.31 per month.
The transitional element also ends in certain other circumstances, such as if you form a couple or you split up with your partner.
