New-style ESA, credits only

Why might it be of interest?

As the rules stand students cannot generally apply for Universal Credit (UC) while still in education.  There are a few exceptions and one of these is that where all of these are true:

• a young person has a disability
• they are aged 16+
• currently in receipt of PIP
• they have an established limited capability for work (LCW) or limited capability for work related activities (LCWRA)

they can claim UC when they finish school (or their current educational placement) even if going onto college – and they will be successful.

You don’t have to apply for UC in this window but if you don’t already have the LCW/LCWRA you won’t be able to apply for UC at any time while they are in college/uni.

A young person in education cannot usually claim means tested benefits such as Universal Credit (UC).

A disabled young person in education who has a limited capability for work (LCW) OR a limited capability for work related activity (LCWRA) CAN claim UC while still in education.

But only if they have the LCW/LCWRA established BEFORE they start education.

What this means is that while they are in school they are not eligible to claim UC – they’re already in education.

The opportunity comes when they are coming to the end of their school days before going onto college/uni.

If they already have an LCW/LCWRA they will be able to claim UC in their last term at school and it will be paid from when they leave school.

How do I get an LCW/LCWRA established?

When a young person turns 16, if they are in receipt of PIP / DLA, you can make a claim for a benefit called new-style ESA, credits only.

No money is paid to the young person but it triggers a Work Capability Assessment (WCA).

The WCA determines if the young person has an LCW or LCWRA and if they do they can then claim UC when they are finishing school – even if they are going on to college or university.

The outcome of this WCA is binding on UC so the young person won’t need to go through it again when they claim UC.

So why not just wait until they’re finishing school?

The young person must have the LCW/LCWRA before they start education (ie go to college or uni).

There’s not enough time between finishing school and starting college/uni to complete the UC application and the WCA – the process can take months – and

If the young person starts college/uni without an established LCW/LCWRA they will not be able to claim UC for the whole time they are at college/uni.

The process

I’m hoping to have a clearer description of the process at some point from a parent who is currently going through it but I can tell you this:

• You have to apply by phone
• You will be asked a number of questions
• I believe you can ask for a form to be sent to you
• Further information will be sent to you

You will need to get a fit note from your GP at some point – I am not sure if you need this right away or only when requested.  The only reason for not getting it right away is that fit notes are usually time limited – although they can be for several weeks or months, I believe.  If the application process doesn’t finish before your fit note expires you will have to get another one – but this shouldn’t be a problem.

This application triggers a Work Capability Assessment (WCA) which is initially a paper based assessment but could lead to an in-person interview (we’re not sure how often this actually happens).  The WCA is what determines if a young person has a limited capability for work or a limited capability for work related activities.  Of course, there may be young people who would be deemed fit for work, in which case this process won’t help.

We have heard from families occasionally that they have made the phone call and been told that the young person is not eligible to apply for new-style ESA, credits only.  The advisor is wrong – they are!  However, it’s usually easier not to try to argue it and simply call back the next day.  So far, we haven’t heard of any families not being able to make this claim.

How much does a young person get?

The young person will receive the basic element of UC which from April 2026 will be £338.58 for a young person under 25.  This is in addition to their PIP.

If a young person has an LCWRA they will be eligible for an additional payment of approximately £200 per month.  The government is proposing to restrict this to over 22s.  A young person with an LCW is not eligible for the additional payment but they will not be expected to look for work (which is what you usually have to do to be eligible to receive UC).

Note:  It is usually the claim for UC that triggers the WCA and if a young person is finished with education they can just make a UC claim and undergo the WCA in that order.  This process is for young people who expect to remain in education after school as if they make a claim for UC while at school or college they won’t get as far as the WCA – UC will turn them down because they are a student.  And this process is the only other way to get a work capability assessment carried out.

What’s the difference between an LCW and LCWRA?

A young person with an LCW is not entitled to an additional UC payment but they will have no or very few conditions attached to their claim.  As UC is usually an earnings replacement benefit most people claiming will have to be actively looking for work but this is not the case for people with an LCW.  People in this category may be able to work in the future.

A young person with an LCWRA will receive an additional payment of about £200 – possibly having to wait until they turn 22 (not sure if they will have to claim or if it will be automatic) and they will not have any conditions attached to their claim.  People in this category are not expected to be able to work now or in the future.

Young people with an LCWRA may also be able to claim an additional payment if they meet the ‘severe conditions’ criteria which basically means that their disability is life long, diagnosed and they are constantly affected by the LCWRA descriptor they meet on the work capability assessment form.  For example, if they achieved LCWRA status because they ‘cannot learn how to complete a simple task, such as setting an alarm clock, due to cognitive impairment or mental disorder’ this would have to be constant – not something that they can sometimes do and sometimes not.

Notes:

This is a course of action recommended by Contact and by Renaissance Legal.  The rules may change at any time but this is what we can do at the moment.

If we don’t need the money why apply for UC?

Good question!  If you are not on benefits yourself and you don’t feel you need the money from UC you don’t have to apply for it as soon as your young person finishes school.  But it is as well to be prepared to claim by completing the claim for new-style ESA, credits only.

If you are on benefits yourself you must get advice from a benefits advisor before any young people on your claim make their own claim as this will affect your claim.

However, young people will come off your claim at some point.  This is what google tells me:

Disabled young people generally stop being considered a dependent on a parent’s Universal Credit (UC) claim on 31 August following their 19th birthday, provided they remain in approved, non-advanced education or training.

Turning 20: Regardless of education status, the young person is no longer considered a “qualifying young person” for UC once they turn 20.

Moving to Advanced Education: If they move into higher education (e.g., university), they stop being a dependent.

Leaving Education/Training: If the young person leaves approved, full-time non-advanced education (e.g., school or college) or approved training, the parental child element usually stops.

The problem for you if you are on benefits and your young person is coming off your claim is that if the young person is in college – or wants to go on to college – and you have not made the claim for new-style ESA, credits only and established that they have a limited capability for work they will not be able to claim UC in their own right as a student – so as a family you will be losing money each month with no way to replace it via UC.

Other reasons for a young person to apply for UC

These are more peripheral but could be relevant – basically free prescriptions, dental care, eye care, etc stop for our young people when they turn 19 – even if they are still in education.  They may be entitled to free prescriptions because of a medical condition or help with costs but if they are in receipt of UC this entitles them to free prescriptions and other help with healthcare costs where it’s not entirely free.  Being in receipt of PIP does not help here as it is not a means tested benefit.

Further information:

UC and LCW overview:  https://ruils.co.uk/article/quick-overview-of-universal-credit-and-a-limited-capability-for-work/

UC and students:  https://ruils.co.uk/article/uc-and-students/

Work Capability Assessment:  https://ruils.co.uk/article/work-capability-assessment-points/