The second cost of living payment should now have been paid to eligible UK households between 31 October and 19 November.
Millions of households received £300, in the second batch of cost of living support payments. According to the government, 7 million people have received payment – 99% of those eligible.
Even with the payment many will still struggle to pay for their energy – see help with gas and electricity bills for the support available. And if you’re thinking of doing an energy comparison to find a cheaper deal, our guide takes you through what you need to know, including whether it’s better to fix or stick with the energy price cap.
When will the cost of living payment be made?
The Department for Work and Pensions (DWP) confirmed on 7 November that 99% of eligible households have been paid, totalling £2.2 billion. Any remaining payments will be made by 19 November 2023.
Please note: If you’re eligible but you’ve not received your second payment, you can report it missing at GOV.UK.
This is the second of three cost of living payments, which will be worth a total of £900 to eligible households to provide financial support during the ongoing economic situation.
In total around eight million households will receive the latest instalment of cost of living payments.
Who can get cost of living payments?
The cost of living payments are available to households receiving some form of means-tested benefits or tax credits. These include:
- Universal Credit
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Working Tax Credit
- Child Tax Credit
- Pension Credit
In order to be eligible for the latest cost of living payment, you will need to have been paid (or have been entitled to) a qualifying benefit or tax credit between 18 August and 17 September this year.
Are you still struggling with energy bills?
While the cost of living payment is helpful, many households will still struggle with their bills this winter. See what help you can get with your bills, including firm-by-firm hardship grants you may be eligible for.
Further support may be available in the form of part or wholly subsidised insulation to help with your heating. If your home’s in a lower council tax band and has low energy efficiency, check out the Great British Insulation Scheme to see if you qualify.
You may also qualify for the Warm Home Discount scheme, which gives a £150 discount on your winter energy bill. This is a one-off £150 payment applied directly to your electricity or gas bill between October and March.
It’s also a good idea to check with your local council to see if you can benefit from the Household Support Fund. It provides vulnerable households with financial support for everyday necessities, such as energy bills. Find your local council’s website at GOV.UK.
Also, check out our comprehensive energy saving tips to help reduce the cost of your bills.
Do I have to pay tax on the cost of living payments?
You do not have to pay tax on the cost of living payments.
Not only are the payments themselves tax-free, but they also do not count towards the benefit cap. In addition, receiving these payments will not have any impact on existing benefit awards.
How will I receive cost of living payments?
The cost of living payments will be made automatically. As a result, you don’t need to do anything to actively claim them ‒ the money will simply be paid directly to you.
For claimants of joint tax credits, payments will be made into the bank account receiving the Child Tax Credit rather than the account receiving Working Tax Credits.
Those who receive only tax credits, rather than both tax credits and means-tested benefits, will receive their payment between 10 and 19 November.
If you receive means-tested benefits, then the payment reference in your bank account will be DWP COL followed by your National Insurance number. If you are getting tax credits then the reference on the payment will be HMRC COLS.
Beware of cost of living payment scams
Since its launch in the spring, the cost of living payment scheme has been used as a means for scammers to exploit vulnerable people.
Cost of living payment scams include emails, SMS messages, cold calls or fake web ads claiming to be from the DWP. These will attempt to get personal information such as bank account details.
Please bear in mind that cost of living payments are automatic, meaning those eligible don’t have to do anything. The DWP will not attempt to contact you for information, so alarm bells should ring if you’re contacted by anyone saying they’re from the department.
Read how to spot a scam to find out what to do if you think you’re being targeted by fraudsters.
When will the third cost of living payment be made?
We don’t yet know when the third cost of living payment will be made, beyond that it will be for £299 and will take place in the spring.
The DWP said that payment windows and eligibility criteria for the third cost of living payment will be “announced in due course”.
Pointedly it noted that receiving a previous cost of living payment does not mean you will be entitled to a future one, with recipients having to “meet the separate eligibility criteria for each payment”.
Greater help for pensioners
There is more help on the way for pensioners. If you’re entitled to the Winter Fuel Payment, and are above state pension age, you’ll get a top-up of £300 this coming winter. You should receive a letter in October or November telling you how much you’ll receive in total.
The government has also urged low-income pensioners to check their eligibility for Pension Credit. The backdating rules around the cost of living payments mean that those who qualify for the credit could also receive the second cost of living payment as well as the third batch, which will be paid next spring.
