The DWP can require the information or evidence it considers necessary about your award, and Universal Credit counts money in your bank account as capital. A payment received within the past 12 months by way of arrears of a benefit is disregarded as capital, so a backdated payment is not counted straight away.
Key points
✓GOV.UK says money in your bank account counts as capital for Universal Credit
✓Arrears of a benefit received within the past 12 months are disregarded as capital under Schedule 10
✓Below £6,000 does not affect your award, between £6,000 and £16,000 your payments are reduced, and you must usually have no more than £16,000 to claim
✓Where the DWP requires evidence, you have 14 days from notification unless a longer period applies
✓You usually need to ask for mandatory reconsideration within one month of the date of the decision
Why has the DWP asked for my bank statements?
GOV.UK says that when it assesses your entitlement to Universal Credit it takes into account as capital the value of all money, savings and investments you own, or you jointly own with someone else, including money in your bank account.
Regulation 38 of the Claims and Payments Regulations 2013 says a person entitled to benefit must supply such information or evidence as the Secretary of State may require, in the manner the Secretary of State determines, for deciding whether a decision on the award should be revised or superseded, and in connection with payment of the benefit awarded.
GOV.UK says you must report changes to your money, savings and investments as soon as they happen, including inheritance payments, redundancy pay, pension and life insurance lump sums, compensation payments and divorce settlements. If you tell the DWP late or do not report a change, you could get paid too much Universal Credit, which is called an overpayment.
GOV.UK says income is counted as savings if it has not been spent by the end of the assessment period after the one in which it was received.
The regulation does not say how many months or years of bank statements the Secretary of State may require. It leaves the choice of information or evidence to the Secretary of State.
GOV.UK says these are among the things taken into account as money, savings and investments:
✓Yes: Money in your bank account, including your main bank account
✓Yes: Current accounts and digital-only accounts such as PayPal
✓Yes: Savings accounts: bank, building society, credit union, Help to Save, Post Office and National Savings and Investments (NS&I) accounts
✓Yes: Individual Savings Accounts (ISAs): cash, stocks and shares, Innovative Finance, Help to Buy, and Lifetime ISAs
✓Yes: Premium Bonds, dividends, stocks and shares
✓Yes: Unspent benefits, for example Child Benefit, Personal Independence Payment (PIP) and Disability Living Allowance (DLA)
GOV.UK says these are not taken into account:
✗No: Your debt, when it works out your total money, savings and investments
✗No: Your personal possessions
✗No: The value of the property you own and live in
✗No: Money, savings and investments that belong to your children and are in their name
The key rule: backdated benefits are ignored for 12 months
Schedule 10 to the Universal Credit Regulations 2013 disregards as capital a payment received within the past 12 months by way of arrears of, or compensation for late payment of, universal credit, a benefit abolished by section 33 of the Welfare Reform Act 2012, or a social security benefit that is not counted as unearned income under regulation 66(1)(a) or (b).
GOV.UK says benefits arrears payments, with or without compensation for late payment, are not counted as money, savings or investments for up to 12 months after you receive them. You must still tell the DWP about them, because GOV.UK says it needs to decide whether to take them off your overall money, savings and investments.
Keep the decision letter or award notice that shows the lump sum was a backdated benefit payment, because the disregard applies to a payment by way of arrears of a benefit.
The disregard covers a payment received within the past 12 months, and GOV.UK says these payments are not counted for up to 12 months after you receive them. GOV.UK says money in your bank account counts as capital.
How the savings rules work
GOV.UK says to claim Universal Credit you must usually have no more than £16,000 in money, savings and investments as a single claimant or if you are living with a partner.
Money, savings and investments
What happens to your Universal Credit
Below £6,000
If you have below £6,000 it will not affect your award.
£6,000 to £16,000
Your payments will be reduced by £4.35 for every £250 you have between £6,000 and £16,000, and another £4.35 is taken off for any remaining amount that is not a complete £250.
More than £16,000
In GOV.UK's example, savings of £17,000 are not eligible for Universal Credit.
Regulation 72 of the Universal Credit Regulations 2013 treats capital as yielding a monthly income of £4.35 for each £250 in excess of £6,000 and £4.35 for any excess which is not a complete £250. In GOV.UK's example, savings of £6,300 are £300 over £6,000, so Universal Credit is reduced by 2 x £4.35 a month, that is £8.70. In another example, savings of £14,500 are £8,500 over £6,000, so it is reduced by 34 x £4.35 a month, that is £147.90.
How long does a capital review take?
We found no rule or published DWP timescale that fixes how long a capital review takes. GOV.UK says your journal is not an instant messaging service and it might take a few days to reply to you.
You have 14 days from the date the notification was given or sent to supply what the DWP requires, or any longer period the DWP allows in the notification
You can ask for longer by satisfying the DWP that a longer period is necessary in order to comply
You can instead satisfy the DWP that the information or evidence does not exist or that it is not possible for you to obtain it
A suspended benefit must be paid once the DWP is satisfied that it is properly payable and the requirements have been satisfied
Regulation 44 says the Secretary of State may suspend payment, in whole or part, where it appears that an issue arises whether the conditions for entitlement to the benefit are or were fulfilled.
What you should do
Where the DWP requires evidence from you under regulation 38(2), regulation 45 of the Decisions and Appeals Regulations 2013 says you must either supply it within 14 days beginning with the date the notification was given or sent to you, or such longer period as the Secretary of State allows in that notification, or such longer period as you satisfy the Secretary of State is necessary in order to comply.
Send what the DWP requires within the period in its notification
If you cannot get it in time, ask for a longer period and explain why it is necessary
Use your journal to message your work coach or case manager, but do not include bank details or National Insurance numbers in it
Keep the decision letter or award notice that shows the payment was arrears of a benefit
GOV.UK also says not to include information that might put you at risk of fraud, for example bank details or National Insurance numbers, in your journal.
Regulation 50 says you are treated as having capital you have deprived yourself of for the purpose of securing entitlement to universal credit or an increased amount of universal credit. You are not treated as depriving yourself of capital if you dispose of it to reduce or pay a debt, or to buy goods or services if the expenditure was reasonable in the circumstances of your case.
Do I have to provide the statements?
Regulation 38 says a person entitled to benefit must supply the information or evidence the Secretary of State may require. The Secretary of State may suspend payment of the benefit, in whole or part, if you fail to satisfy those requirements.
If payment has been suspended in full under regulation 45(6) and more than one month has elapsed since the first payment was suspended, regulation 47 says the Secretary of State must decide that you cease to be entitled to the benefit with effect from the date on which payment was suspended, unless entitlement ceased earlier.
Within that period you can instead satisfy the Secretary of State that the information or evidence does not exist or that it is not possible for you to obtain it. A suspended benefit must be paid once the Secretary of State is satisfied that it is properly payable and that the requirements of regulation 45(4) have been satisfied.
If you disagree with their decision
GOV.UK says mandatory reconsideration is free to ask for.
Ask for mandatory reconsideration within one month of the date of the decision
You can ask for it after one month if you have a good reason, for example if you have been in hospital or had a bereavement
After mandatory reconsideration you can appeal to the tribunal within one month of getting your mandatory reconsideration decision
GOV.UK says to appeal to the tribunal within one month of getting your mandatory reconsideration decision, and that if you start your appeal after a month you will have to explain why you did not do it earlier.
Why has the DWP asked me for several years of bank statements?
Regulation 38 of the Claims and Payments Regulations 2013 says a person entitled to benefit must supply such information or evidence as the Secretary of State may require, in the manner the Secretary of State determines, for deciding whether a decision on the award should be revised or superseded, and in connection with payment of the benefit awarded. The regulation does not say how many months or years of bank statements the Secretary of State may require.
Does a backdated benefit payment count as savings for Universal Credit?
Schedule 10 to the Universal Credit Regulations 2013 disregards as capital a payment received within the past 12 months by way of arrears of, or compensation for late payment of, universal credit, a benefit abolished by section 33 of the Welfare Reform Act 2012, or a social security benefit that is not counted as unearned income under regulation 66(1)(a) or (b). GOV.UK says benefits arrears payments, with or without compensation for late payment, are not counted as money, savings or investments for up to 12 months after you receive them.
Will my Universal Credit stop while they review my bank statements?
The Secretary of State may suspend payment of the benefit, in whole or part, if you fail to satisfy those requirements. A suspended benefit must be paid once the Secretary of State is satisfied that it is properly payable and that the requirements of regulation 45(4) have been satisfied. Regulation 44 says the Secretary of State may suspend payment, in whole or part, where it appears that an issue arises whether the conditions for entitlement to the benefit are or were fulfilled.
Should I spend the money to get back under £6,000?
Regulation 50 says you are treated as having capital you have deprived yourself of for the purpose of securing entitlement to universal credit or an increased amount of universal credit. You are not treated as depriving yourself of capital if you dispose of it to reduce or pay a debt, or to buy goods or services if the expenditure was reasonable in the circumstances of your case.
Know Your Rights UK. "Universal Credit Asking for Bank Statements? Capital Checks." Know Your Rights UK, https://www.knowyourrightsuk.com/benefits/universal-credit/bank-statements