In the face of persistent inflation, millions of UK households are struggling to afford even basic necessities. To ease this financial pressure, the government has announced an additional one-time Cost of Living Payment of £605 in 2025. This payment will go directly to individuals already receiving certain benefits such as Universal Credit, Pension Credit, Income Support, or Tax Credits, ensuring that the most vulnerable receive extra support without having to reapply.
Scheme
This initiative is part of the Cost of Living Adjustment program. The £605 will be provided to residents who are already beneficiaries of government schemes, offering them tax-free, non-repayable assistance. It aims to help recipients cover essential costs like food, housing, and energy bills, without reducing the benefits they already receive.
Purpose
The scheme is targeted at people who are struggling due to rising living costs and limited income. This includes pensioners, unemployed individuals, and those with disabilities. By providing direct payments into bank accounts, the government ensures faster support while reducing the risk of fraud or delays.
Eligibility
Only recipients of certain benefits will qualify for this payment. These include:
- Universal Credit
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Pension Credit
- Child Tax Credit
- Working Tax Credit
Those on contribution-based benefits will not be eligible. If a person is registered under multiple qualifying schemes, they will still receive the £605 only once.
Payment
The Department for Work and Pensions (DWP) will deposit the payment directly into the bank accounts of eligible individuals by the end of July 2025. The exact distribution date has not been confirmed, but the process will be automatic—no separate application is needed.
Benefits
This scheme offers several advantages:
- A lump sum payment of £605 directly into beneficiaries’ accounts
- No tax charged on the payment
- No reduction in other benefits after receiving the payment
- Fast, automatic transfer without extra paperwork
Preparation
To avoid payment issues, beneficiaries should ensure:
- Their National Insurance Number is active
- Bank account details are up to date
- Income and residency documentation is current
The £605 Cost of Living Payment will serve as a timely lifeline for those already navigating financial hardship. By delivering tax-free, direct support, the UK government aims to help vulnerable households manage essential costs and maintain stability during challenging times.
FAQs
When will the £605 payment be made?
By the end of July 2025.
Who qualifies for the £605 support?
Recipients of certain UK benefits like Universal Credit.
Is the £605 payment taxable?
No, it is completely tax-free.
Do I need to apply for the £605 payment?
No, it will be paid automatically.
Will I get multiple payments if I am on many benefits?
No, you will only get £605 once.
