Benefit cap

Legislation
Guidance
Case law

The rules for the benefit cap are set out in the Welfare Reform Act 2012 and the Universal Credit Regulations 2013 (SI.No.376/2013).

NB: See below for equivalent legislation in Northern Ireland.

Power to apply the benefit cap	Section 96 of the Welfare Reform Act 2012 and Regulation 78 of SI.No.376/2013	Make provision for the benefit cap to limit the total amount of benefit that is paid.
Amount of cap	Regulation 79 of SI.No.376/2013	Sets out the amount of the cap and the benefits that are included.
Calculating relevant welfare benefits	Regulation 80 of SI.No.376/2013	Sets out the manner in which the cap is calculated including how to calculate the amount of a welfare benefit included in the cap.
Reduction of universal credit	Regulation 81 of SI.No.376/2013	Sets out the method for reducing universal credit.
Exception for earnings	Regulation 82 of SI.No.376/2013	Sets out rules for exception from the benefit cap on account of the level of earnings and where grace period rules are met.
Exceptions for benefit entitlement	Regulation 83 of SI.No.376/2013	Sets out rules for exception from the cap on account of entitlement to specified benefits.
Challenging decisions	Paragraph 8A of Schedule 2 to the Social Security Act 1998	Sets out that there is no right of appeal against a decision to cap universal credit.

In Northern Ireland, the Welfare Reform (Northern Ireland) Order 2015 together with SR.No.216/2016 make provisions that are largely equivalent to those in Great Britain.

Further explanation of the legislation is set out in guidance. Please note, however, guidance is not binding and cannot override the legislation.

Advice for decision making	Chapter E5	Sets out guidance to DWP decision makers on the benefit cap.
DWP guidance from parliament.uk	Benefit cap	Provides guidance on the benefit cap including on its calculation, and exemptions from and challenges to the cap.

Case law provides further interpretation of the legislation and establishes legal precedent.

Court of Appeal	[2021] EWCA Civ 1454	Court of Appeal rules that universal credit benefit cap earnings assessment is not irrational and unlawful in the case of a four-weekly paid claimant. More information: Read the rightsnet summary
High Court	[2020] EWHC 1944 (Admin)	High Court rules that the assessment of earnings under universal credit benefit cap rules is irrational and unlawful because it subjected a working mother to the cap solely because she was paid on a four-weekly basis rather than calendar monthly. More information: Read the rightsnet summary

Court of Appeal

[2021] EWCA Civ 1454

Court of Appeal rules that universal credit benefit cap earnings assessment is not irrational and unlawful in the case of a four-weekly paid claimant.

High Court

[2020] EWHC 1944 (Admin)

High Court rules that the assessment of earnings under universal credit benefit cap rules is irrational and unlawful because it subjected a working mother to the cap solely because she was paid on a four-weekly basis rather than calendar monthly.