Virus

COVID-19 (coronavirus) and your finances

Financial advice and guidance for members affected by COVID-19

If your finances have been affected as a result of the COVID-19 situation, this page provides guidance on the entitlements and support that may be available to you.

legislation.gov.uk

New legislation

The Social Security (Coronavirus) (Further Measures) Regulations 2020 relates to a number of the changes to welfare benefit entitlement.
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Applying for Universal Credit (UC)

Due to a large surge in applicants claiming Universal Credit, the DWP is experiencing lengthy delays and technical difficulties with both telephone and online systems. If you cannot get through, do keep trying, as the DWP is in the process of deploying more resources and staff to deal with the increase in demand. Where possible, you are advised to Apply For Universal Credit online.

Statutory Sick Pay (SSP)

If you're off sick due to COVID-19 and/or have to self isolate in line with government guidelines check your contract to see if you are entitled to contractual sick pay.

If you are not entitled to contractual sick pay, you should be able to get Statutory Sick Pay (SSP) as long as you earn an average of at least £120 per week. You can check your eligibility for SSP on the gov.uk website.

If eligible, you will receive Statutory Sick Pay (SSP) from the first day that you cannot attend work. 

Universal Credit

If you think Statutory Sick Pay (SSP) will not be enough to support you, you can also put a claim in for Universal Credit for a top-up benefit or to help pay rent.

The government announced it will be making temporary arrangements for people affected by COVID-19 who are already claiming benefits or those needing to make a new claim for benefits.

For more information, see the Employment and benefits support section on the government's Understanding Universal Credit website.

Furlough and the Job Retention Scheme

If your employer is unable to operate or has no work for you to do because of COVID-19, your employer could agree to keep you on the payroll instead of laying you off. You’d get 80% of your regular wages through the Coronavirus Job Retention Scheme (JRS), up to a monthly cap of £2,500.

The furlough scheme was due to be replaced by the Job Support Scheme (JSS) on 1 November. Instead, furlough will now continue and will pay up to 80% of workers’ wages (up to £2,500 a month) – until December.

To be eligible for the extension employees must have been on the payroll on 30 October 2020.

Shielding: medical suspension or furlough

If you are shielding in line with public health guidance or required to stay home due to an individual in your household shielding, and you cannot work from home, you may be able to ask for medical suspension or furlough. For more information see the RCN's FAQ guidance under heading 'Furlough: the job retention scheme and eligibility.'

Other benefits

For an overview of all benefits you might be entitled to visit the following website: Entitled to where you can do a full online benefits calculation.

Once you have got a clear understanding of what you might be entitled to, you may need to take additional measures to manage a reduced income. There may also be delays in processing new claims for benefits.

Support from the RCN Welfare team

If you want further advice, you can contact the RCN's welfare service.

Self-employed workers and sick pay (ESA)

If you are off sick due to COVID-19 or have to self-isolate in line with government guidelines, but are not entitled to SSP, then you may be able to claim Employment Support Allowance (ESA).

ESA is based on your National Insurance contributions and currently paid at a rate of £74.35 per week. How much you get will depend on what stage your application is at, as well as things like your age and whether you’re able to get back into work.

If you are off sick with COVID-19 or are advised to self-isolate, and are eligible for ESA, then it will be payable from day one.

For more details, see the gov.uk website: How to claim ESA.

Self-employed workers and Universal Credit

If ESA will be your only income, you may be better off claiming Universal Credit (UC), which can also assist with your rental costs and support for dependants.

For more information, see the Employment and benefits support section on the government's website.

The Self-employed Income Support Scheme (SEISS)

The Self-employment Income Support Scheme (SEISS) was introduced to support self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19. 

Government support for the self-employed will now be extended until 30 April 2021, with a third and fourth grant available. The date to apply has also been brought forward to 30 November. (It was originally set to open 14 December.)

For more information see Self-Employment Income Support Scheme grant extension on the Gov.uk website.

Self-employed workers already receiving Universal Credit

In March 2020, the Minimum Income Floor (MIF) was suspended to ensure that self-employed UC claimants would receive support. The government has recently confirmed that that the MIF will remain suspended until April 2021.

The further suspension means self-employed people will continue to receive crucial financial support from Universal Credit based on their current actual earnings, providing additional protection for those who see a drop in earnings due to the impact of Covid 19.

If you are eligible for 'New Style Employment and Support Allowance' (ESA), it will now be payable from the first day of sickness (rather than the eighth), if you have COVID-19 or are advised to self-isolate.

If you have COVID-19 or need to self-isolate, you can now claim and have access to advance payments without needing to attend a Jobcentre Plus office. You should visit the Government's guidance on Claiming Universal Credit: step by step for more information.

Universal Credit and SEISS funds

If you have been claiming funds via SEISS (Self Employed Income Support Scheme) then you may receive a lump sum payment. If you are claiming Universal Credit, any such lump sum payments will be counted as your earned income and treated in the same way as any wages would be.

With Universal credit, earnings you receive from previous months can affect how much you get in future months. So if you earn more than £2,500 over the amount you can earn before your Universal Credit entitlement is reduced to £0 (i.e. because you received a lump sum) you are said to have ‘surplus earnings.’ This may reduce the amount of Universal Credit you receive, or perhaps mean that you can’t get any Universal Credit payment in subsequent assessment periods. 

From 28 September if a person is instructed to self-isolate by NHS Test and Trace that this is a legal requirement.

To compensate people who will lose money by isolating, and who meet certain criteria, a payment of £500 can be made.

These payments are to be administered by Local Authorities and each LA is expected to have an application, assessment and payment process in place by 12 October. Payments can be backdated to 28 September.

Eligible individuals should check the Covid-19 pages of their Council website in the week commencing 12 October where they will find a link to make an application. You cannot make an online application, or do not have someone to submit an application on your behalf, please advise call your council in the week commencing 12 October and you can be advised how to make a telephone application. This is only for people who absolutely cannot make an online application.

There are further details of the eligibility criteria below. For those people who meet most of the conditions, but are not receiving a qualifying benefit, there will also be a discretionary fund, but further advice to councils is to follow about this.

One essential criteria to qualify for any payment is that the person has been told to self-isolate by “NHS Test and Trace” and has an 8 digit ID number to demonstrate this. If you do not have this ID number, you do not qualify for a payment.

1. Test and Trace Payments: an overview

From 28 September 2020, individuals will be entitled to a Test and Trace Support Payment of £500 if they:

  • Have been told to stay at home and self-isolate by NHS Test and Trace, either because they have tested positive for coronavirus or have recently been in close contact with someone who has tested positive
  • Are employed or self-employed
  • Are unable to work from home and will lose income as a result
  • Are currently receiving Universal Credit, Working Tax Credit, income-based Employment and Support Allowance, income-based Jobseeker’s Allowance, Income Support, Housing Benefit and/or Pension Credit.

This payment is designed to support people on low incomes, if they will lose income as a result of self-isolating, and to encourage them to get tested if they have symptoms. This is important to help stop the transmission of COVID-19 and avoid further economic and societal restrictions. The scheme will last until 31 January 2021.

These payments will be made available from 28 September 2020, and local authorities should have arrangements in place to administer them by no later than 12 October 2020. Someone told to self-isolate on or after 28 September (but before the scheme is operational in their local authority) will need to be able to make a backdated claim for payment.

Local authorities will also be able to make a discretionary £500 lump sum payment in exceptional circumstances to an individual who meets the main qualifying criteria for the Test and Trace Support Payment (i.e. they are a low-income worker who is unable to work because they are self-isolating) but is not in receipt of qualifying benefits and could suffer financial hardship as a result of not being able to work.

2. Eligibility for payments

Backdating

Eligibility for the NHS Test and Trace Support Payment, including discretionary payments, will be for people who are told to self-isolate on or after 28 September 2020 and who meet the relevant eligibility criteria.

Residents in local authorities who do not have arrangements in place to administer the payment from 28 September 2020 will be able to claim retrospectively, as long as their period of self-isolation began on or after this date.

Local authorities should not accept applications from people told to self-isolate before 28 September 2020, even if the period of self-isolation continues after 28 September.

Applications from members of the same household

People in the same household can each make an individual application to receive the payment, if they each meet the eligibility criteria.

Multiple claims

Someone can claim more than once (if they are told to self-isolate multiple times), as long as they meet the eligibility criteria for each individual claim and their periods of self-isolation do not overlap. Local authorities may wish to consider keeping a record of individuals who make multiple claims to guard against potential fraud.

Applications made after someone’s period of self-isolation has ended

Eligible individuals can make a claim up to 14 days after their period of self-isolation ended. Local authorities should not accept applications after this point.

Third-party applications

Applicants can apply on behalf of someone else. However, the £500 must be paid into a bank account in the name of the person for whom the application is being made (so, for example, if someone applied on behalf of a parent, the payment would be made into the parent’s bank account).

Applicants with other support needs

As part of the information available on the online application form and in the design process, local authorities are encouraged to reference any other local support that is available for people who have been instructed to self-isolate, such as food packages.

Applicants who are self-isolating who haven’t been told to self-isolate by NHS Test and Trace

Local authorities should not approve applications for anyone who does not have a valid notification from NHS Test and Trace. The legal duty to self-isolate that comes into force on 28 September applies only to people who have been told to self-isolate by NHS Test and Trace. This means it is important that people who have tested positive share accurate information about their recent contacts with NHS Test and Trace.

Applicants who are quarantining after returning to the UK

The Test and Trace Support Payment scheme does not cover people who are self-isolating after returning to the UK from abroad, unless they have tested positive for coronavirus or have been instructed to self-isolate by NHS Test and Trace.

Applicants who are furloughed

Local authorities should not make payments to applicants whose income is lower than normal because they are furloughed.

The Test and Trace Support Payment is only for people facing a reduction in income because they cannot work while self-isolating.

3. Application process

Local authorities will put arrangements in place to process and verify applications, issue payments to successful applicants and prevent and detect fraud.

Each local authority will need to have its own online application system – and an alternative system for non-digital users.

To apply, applicants will complete an online form (or a telephone application if digitally excluded) and provide their local authority with:

  • A notification from NHS Test and Trace asking them to self-isolate;
  • Proof of receipt of one of the qualifying benefits;
  • A bank statement; and
  • Proof of employment or, if they are self-employed, evidence of self-assessment returns, trading income and proof that their business delivers services which cannot be undertaken without social contact.

Once this evidence has been verified, the local authority will pay the applicant £500. This payment should be made within three working days of receiving an eligible application.

Student nurses

If you are a student nurse, see our COVID-19 advice for students FAQs, which includes information on:

  • student funding and maintenance grants
  • advice on how paid clinical placements might affect any welfare benefits, tax credits or entitlements.

Universal Credit standard allowance increases

From the 6th April, the government is increasing the standard allowance in Universal Credit and the basic element in Working Tax Credit for one year.

Both will increase by £20 per week on top of planned annual uprating. This will apply to all new and existing Universal Credit claimants and to existing Working Tax Credit claimants.

This means that for a single Universal Credit claimant (aged 25 or over), the standard allowance will increase from £317.82 to £409.89 per month.

For more information about this, see the Cororavirus and claiming benefits page on the government's Understanding Universal Credit website.

Universal Credit and advance payments during the COVID-19 outbreak

If you start a claim for Universal Credit, you will have to wait at least 5 weeks for your first payment to come through. If you don’t think you’ll have enough money to live on during this time, you can request an 'advance payment' when you apply. The advance payment is a loan, meaning you have to pay it back through your future Universal Credit payments. You do not pay any interest.

If you have been affected by the COVID-19 outbreak, you will be able to apply for a month’s advance payment upfront, without physically attending a jobcentre or having a Universal Credit interview.

Universal Credit and the suspension of advance payment deductions

Deductions for repaying the advance would usually be made from your very first monthly payment onwards. In response to the COVID-19 outbreak, government guidance states deductions can be delayed for up to 3 months if claimants are experiencing an unexpected financial crisis. 

Therefore, if you make a claim for Universal Credit and need to request an advance payment, you may also wish to request a suspension of deductions so that you don’t have to make any repayments for the first 3 months. You should do this via your Universal Credit journal. 

Universal Credit and furlough pay / SEISS funds

If you have been furloughed, or are claiming funds via SEISS (Self Employed Income Support Scheme) then you may receive a lump sum payment. If you are claiming Universal Credit, any such lump sum payments will be counted as your earned income and treated in the same way as any wages would be.

With Universal credit, earnings you receive from previous months can affect how much you get in future months. So if you earn more than £2,500 over the amount you can earn before your Universal Credit entitlement is reduced to £0 (i.e. because you received a lump sum) you are said to have ‘surplus earnings.’ This may reduce the amount of Universal Credit you receive, or perhaps mean that you can’t get any Universal Credit payment in subsequent assessment periods. 

Suspension of benefit overpayments 

In response to the COVID-19 outbreak, the Department for Work and Pensions has temporarily paused the recovery of benefit overpayments, for three months. More for information about this, please see the gov.uk press release: Recovery of benefit overpayment suspended.

DWP debt management have also confirmed they are suspending recovery of any new debts at this time.  

What benefits are you entitled to?

For an overview of all benefits you might be entitled to visit the Entitledto website, where you can do a full online benefits calculation.

Once you have got a clear understanding of what you might be entitled to, you may need to take additional measures to manage a reduced income. There may also be delays in processing new claims for benefits.

Some of the steps you can take to reduce your outgoings for this period of reduced income are listed below.

Evictions

In England and Wales, emergency legislation was introduced so that landlords would not be able to start proceedings to evict tenants for at least a three month period. A further announcement was made in June to say this will be extended until the 23rd August 2020. 

The Scottish Government also brought in new rules to extend the notice period required to be given to tenants before landlords can start legal action to obtain an order for eviction. These new rules will be in place till 30 September 2020 in the first instance.

In Northern Ireland, landlords must give tenants at least 12 weeks’ notice to quit before applying for a court order to secure any eviction.

For advice, support and information about protective measures in your country during the COVID-19 emergency, please see:

Struggling with your rent

If your pay has dropped, you can initially apply for assistance with your rent through Universal Credit. For more details, see the Housing section on the Understanding Universal Credit website.

If you are still struggling, pay what you can, but don’t leave yourself short of money for other essentials.

If you are a local authority tenant, speak to the housing department as soon as possible.

If you are a private tenant, speak to your landlord and explain the situation and can ask for more time to pay or ask to catch up any missed payments by instalments. It is a good idea to pay what you can afford and keep a record of what you offered. If you can’t reach an agreement, you can seek advice from the RCN Welfare Service.

Remember, most landlords will struggle to get new tenants right now, so there's a common interest in keeping tenants in properties. Trying to come to a reasonable mutual arrangement helps both. Landlord Associations have encouraged landlords to show forbearance, so good communication is key.

Scheme to help tenants affected by coronavirus in Wales

A new £8 million Welsh Government Tenancy Saver Loan scheme to help tenants struggling with rent arrears due to coronavirus has been launched in Wales.

The scheme will be open to private rented sector tenants in rent arrears and those who may also struggle to pay future months’ rent as a result of coronavirus; it will be open until March 31st 2021.

Struggling with your mortgage

The UK government's mortgage payments holiday scheme, which has allowed householders a six-month payments deferral, was due to end on Saturday 31st October, but this has been extended to help people who will not be able to work during lockdown.

The Financial Conduct Authority (FCA) is working with lenders on the final details. It is proposing that households who have not yet had a payment deferral will be eligible for two payment deferrals of up to six months in total.

Households that currently have an initial payment deferral in place will be eligible for another for up to three months. Meanwhile, those who have resumed their mortgage repayments after an initial payment deferral will be eligible for another three-month payments holiday.

The FCA says it is important that borrowers who can afford to make repayments continue to do so, and is urging consumers not to contact their lender until the enhanced measures are in place. Lenders will soon provide further information.

Under the FCA’s proposals, borrowers would have until 31 March 2021 to request a payment deferral. It is also proposing that no one will have their home repossessed without their agreement until after 31 January 2021.

New and extended mortgage holidays will not show up on your credit report. If you've not had one yet and apply in November, or if you've had one for less than six months and extend it, it won't show up as a missed payment. However, even when it is not on your credit file, lenders can still find out about the payment holiday in other ways and can use that information to help their decision when you next apply for credit.

Although the regulations are being changed over the next couple of weeks to extend the application dates for payment holidays, people who have already had six months of payment holidays won't be able to apply for another one, and will be moved on to "tailored support" based on their individual circumstances.

The following are some of the help measures you may be offered, though lenders are free to offer other solutions if something else works better for your particular circumstances:

A (further) payment deferral - This is likely to be a short-term measure only and may be offered if your circumstances are still changing, and you're not able to commit to a longer-term measure such as changing your mortgage type or length.

A (further) period of reduced payments - If you can pay something towards your mortgage, but can't make the full contractual repayment, your lender may agree to you making reduced payments. Again, this measure is likely to be for the short-term only.

An extension to your mortgage term - This is essentially like a remortgage, and means you'll pay less each month (but as you're borrowing over a longer period, you'll pay more overall).

A change to your mortgage type - For example, this could be switching you to an interest-only mortgage or changing to a product with a different interest rate.

The FCA (Financial Conduct Authority) has issued guidance on how they expect mortgage lenders and administrators to treat customers during the COVID-19 emergency. See Mortgages and coronavirus: information for consumers on the FCA's website for more details.

The RCN Welfare team have had reports that some mortgage companies are trying to persuade members that they should continue with payments, rather than take a three month break. If you have determined that the break is your best option, then you should persist in your request with the lender. If they won’t offer the payment holiday, then ask them for a written explanation and contact us for advice when you have that from them.

Struggling to meet motor finance

If you are struggling to meet your motor finance, the Financial Conduct Authority (FCA) has proposed new guidelines for Motor Finance companies, which includes allowing customers to take a 3 month break.

Check the finance company's website or call them to explore the options that are available to you.

Further details of the proposals can be found on the FCA's website: FCA proposes help for motor finance and high cost credit customers

It might be worth quoting the FCA guidelines when speaking to any motor finance company.

Payment holidays on credit cards, car finance, personal loans and other types of credit are to be extended ahead of tougher coronavirus restrictions.

The FCA, has said it will consult on extending payment holidays for those who haven't yet had one, or those who've had less than six months of payment holidays – this includes car finance.

The FCA had already brought in payment holidays for credit customers in April, extending them for three months in July. They advised that customers who had not yet deferred a payment could now request one for up to six months. They should announce confirmed proposals soon, which apply across the UK.

The payment holidays will also apply to those with rent to own and buy-now pay-later deals, it said. In addition, anyone already benefitting from a payment deferral will be able to apply for a second deferral.

If you have already had six months of payment holidays, you will not be able to benefit from the new proposals, but you may be offered tailored help which could include:

A (further) payment deferral: This is likely to be a short-term measure only and may be offered if your circumstances are still changing, and you're not able to commit to a longer-term measure such as setting up a repayment plan.

A (further) period of reduced payments: If you can pay something towards your debt but can't make the full minimum contractual repayment, your lender may agree to you making reduced payments. Again, this measure is likely to be short-term only.

Waiving or reducing interest: If you can't meet your payments, the lender needs to make sure the amount you owe isn't rising out of control, so it may need to cut or waive the interest it's charging you.

Agreeing a repayment plan: This is where your lender works with you to set up a plan that doesn't meet contractual repayments but allows you to pay off the debt in a reasonable amount of time.

Refinancing your credit agreement: This might mean, for example if you have a credit card, you convert the debt to a loan with a lower rate of interest and agree to pay set monthly instalments over a longer period. This will only be offered where the lender offers personal loans as well as credit cards, and where it's likely to be affordable, and your finances are settled enough to commit to a new agreement.

For high-cost short-term borrowing (e.g. payday loans): Borrowers can ask for a month’s respite if they have not already had a payment break. Once the one-month holiday has expired, payday lenders have to help customers who can’t resume payments. This could be to accept token payments, agree a repayment plan so the debt's paid off over several months, or to waive or lower interest rate charges. So, if you can't pay your payday loan - whether it's a new problem or an ongoing concern - talk to your lender to see which of the solutions works best for you.

The FCA says consumers should not contact their lenders yet and will hear from them once the plans are confirmed.

Nursing Charities

Many charities are still accepting applications for grants during the Coronavirus pandemic, although in some cases they might take longer to process.

RCN Lamplight Support Service (funded by the RCN Foundation)

The RCN's Lamplight Support Service provides:

  • advice on benefit entitlements
  • advice on maximising income during a period of reduced income
  • signposting to relevant debt advice services.

Details about how to access the service can be found on the main Lamplight Support Service page.

Members of the nursing community (past and present) who are not currently working on the frontline can apply for support through the RCN Foundation hardship fund. Details about eligibility can be found in the guide to financial assistance.

Cavell Nurses' Trust 

The Cavell Nurses Trust is another charity specifically for Nurses and Healthcare Support Workers. They offer financial support for short term financial emergencies, for example:

  • Nurses, midwives or HCAs facing financial hardship due to: needing to self isolate, being unable to access occupational sick pay or benefits, losing access to overtime, bank shifts, agency shifts or other enhancements, or those who are self employed.
  • Nurses, midwives or HCAs facing financial hardship because their household or partner’s income has been affected due to Coronavirus, e.g. because their partner is self-employed or works in an industry adversely affected by Coronavirus.

For further information and details on how to apply, see their page Apply for a grant.

Turn2us

If you wish to explore other sources of charitable grants, Turn2us has a comprehensive database that you can search.

Fuel and prepayment meters updates

The government has recently agreed new measures with energy companies to ensure that vulnerable customers who may fall into debt will still be supplied with energy whilst in self isolation. For more details, see the government's press release Government agrees measures with energy industry to support vulnerable people through COVID-19

Money Saving Expert has published a table of different energy providers (e.g. British Gas, E.on, Scottish Power, etc.) with their responses to the measures and contact details. Please see What will energy suppliers do to help prepay customers? for more details. If your energy provider is not listed, you should contact them directly for advice.

Childcare costs whilst you're working

You may find that you have additional childcare costs whilst working during the COVID-19 emergency.

If this is the case, and you are already claiming Universal Credit or Child Tax Credit, these additional costs can be included as part of your claim up to the maximum limits depending on your personal circumstances.

If you are not already claiming the childcare element of Universal Credit or Working Tax Credits, you can request this element as part of an on-going claim.

If you have not previously claimed Universal Credit, your additional childcare costs may mean that you now qualify. To see if you qualify please read the Turn 2 Us guide

If your income is too high to qualify for either of these means tested benefits you can check if you qualify for the Tax-Free Childcare scheme. Tax Free Childcare means the government will pay £2 for every £8 you spend on childcare, up to a maximum of £2,000 per year per child (or £4,000 for a child with a disability).

For more information about help with childcare costs you can visit the Turn 2 Us guide

For information about school and childcare provision for key workers please see the government website or your local authority’s website.

If you are still struggling with childcare costs then please see the information on charities listed below.

Post Office cash deliveries for those shielding (England only)

Vulnerable Post Office customers who are unable to go out to access their money may be eligible for next-day cash deliveries, to ensure they can continue to access their pensions and benefits during the COVID-19 emergency.

If you have one of these accounts and you're eligible to use the scheme, you'll be contacted directly by the Department for Work and Pensions (DWP) (which is running the scheme in partnership with the Post Office) and asked if you need to have cash delivered.

Seek Help

Finally, remember that you do not need to go through this alone.

The RCN Welfare Service can assist you with FCA regulated debt and money advice and specialist benefits advice.

Details of how to contact the service can be found here RCN’s welfare service