Direct payment to landlords and third party deductions – universal credit

Of particular concern to landlords and letting agents about the welfare reforms is whether direct payment to a landlord will be possible under the new rules. There has been much scaremongering and rumour on this particular topic.

In the previous section, payment to a third party on behalf of a claimant was considered but concluded that it’s probably not suitable for direct payments to landlords.

However, regulation 60 The Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013 contains a further direct payment provision:

… deductions may be made from benefit and direct payments may be made to third parties on behalf of a claimant in accordance with the provisions of Schedule 6 …

Schedule 6 contains details about what deductions can be made from universal credit and payable to whom.

Schedule 6 – General

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  1. Paragraph 2(1), Schedule 6  ↩
  2. Paragraph 2(2)  ↩
  3. Paragraph 3(1)  ↩
  4. Paragraph 3(3)  ↩
  5. Paragraph 4(1)  ↩
  6. Paragraph 4(4)  ↩
  7. Paragraph 5(4)  ↩
  8. Paragraph 7(1) – (4)  ↩
  9. See for example page 109 Office of Fair Trading guidance for unfair terms in tenancy agreements  ↩