DWP rule change in Budget will offer thousands of people £4,258 a year

Tens of thousands more people may soon be eligible for Carer's Allowance, worth £4,258 a year, due to changes in the upper earnings limit. The Government plans to increase the current limit of £151 a week, allowing more carers to claim the benefit, which pays £81.90 a week or £4,258.80 a year.

The upper earnings rule has led to many claimants being overpaid, with some 134,800 people owing the DWP as of May 2024, mainly due to carers breaching the earnings limit. The current rules state that income must not exceed £151 a week after tax and expenses are deducted.

Carers UK warned that many claimants were unknowingly being overpaid due to "not understanding the rules". A formal review into the overpayments scandal is set to be carried out.

Suzanne Bourne, head of Carer Support at Mobilise, said: "It is especially important to be aware of exactly how much you earn - this earnings 'threshold' is where the recent issues have come from. Currently, it's up to the individual to check they are not exceeding this limit to avoid having to repay any overpayments. Although there are plans to automatically alert people at risk of falling into this trap, this is not yet the case."

To be eligible for Carer's Allowance, you must care for someone for at least 35 hours a week, and they must be on a qualifying benefit. The person you care for must be on one of the following benefits:

Mobilise provides a Carer’s Allowance checker to determine eligibility for the DWP benefit, reports Teesside Live. For money-saving tips, sign up to our Money newsletter here

A previous Carers UK report found that carers often exceed the earnings limit for Carer's Allowance due to fluctuating earnings, pay rises, or employer errors such as late payments. One carer highlighted the stress caused by receiving demands from the DWP for repayments: "It pushed me over the edge as the letters were very threatening and on top of my caring responsibilities it made me ill. I was scared and felt under constant threat from debt collectors and being taken to court."

Carers UK have recommended that the weekly Carer's Allowance be increased by at least £11.10 and adjusting the earnings limit to correspond with 21 hours a week at the National Living Wage.

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