Millions of benefits claimants will see a boost to their income in 2026 when new rates take effect from April, but several payments and handouts will remain frozen at their current levels. Chancellor Rachel Reeves delivered her second Autumn Budget in November, setting out a series of tax rises for the new financial year to plug a black hole in the public finances. Ms Reeves also confirmed a series of measures aimed to help households that are struggling with rising living costs, including an end to the two-child limit on benefits.
Among the announcement is plans to take levies off energy bills to save households £150 on average in 2026, and up to £300 for some poorer households, while the National Living Wage and National Minimum Wage rates will also rise from April to £900 per year and £1,500 per year respectively. The government has confirmed its commitment to the pension Triple Lock for the duration of this parliament, giving pensioners on the full new State Pension an extra £575 per year from April, while older pensioners on the full basic State Pension will get an extra £439 annually.
Additionally, the Universal Credit Standard Allowance for a single person aged 25 or over is due to increase by around £295 per year from April, while for couples, it will rise by around £465 per year.
But while there are several uplifts due to kick in at the start of the new financial year, there are some that will remain frozen at their current rates, so claimants won’t get any extra cash in 2026.
Listed are six benefits and handouts paid by the Department for Work and Pensions (DWP) and His Majesty’s Revenue and Customs (HMRC) that won’t be going up from April this year.
Benefit cap – DWP
The benefit cap is a limit on the total amount of benefits you can get before your payments are reduced, and it applies to most people aged 16 and over who haven’t reached State Pension age. It affects people claiming all of the following:
- Credit
- Bereavement Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance
- Housing Benefit
- Incapacity Benefit
- Income Support
- Jobseeker’s Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widow’s Pension if you started getting it before 9 April 2001)
The DWP is freezing the benefit cap for another year which means the upper limit will remain unchanged for the 2026/27 tax year. The rates will be as follows:
Annual level of benefit cap (Greater London)
- Couples with or without children) or single claimants with a child of qualifying age – £25,323.00 (Equivalent to £2,110.25 per month)
- Single adult households without children – £16,967.00 (Equivalent to £1,413.92 per month)
Annual level of benefit cap (rest of Great Britain)
- Couples with or without children) or single claimants with a child of qualifying age – £22,020.00 (Equivalent to £1,835.00 per month)
- Single adult households without children – £14,753.00 (Equivalent to £1,229.42 per month)
Capital limits – DWP
Capital limits is the threshold of savings and investments you can have while still being eligible for and receiving the full amount of benefits.
Currently, the upper capital limit is £16,000, so if your savings and investments exceed this then this would make you either ineligible to receive benefits, or you may receive a reduced amount.
This upper limit will remain frozen at £16,000 in the 2026/27 tax year and will affect those who claim benefits including Universal Credit, income-based Jobseeker’s Allowance, income Support, income-related Employment and Support Allowance and Housing Benefit.
Addition at age 80 pension top-up – DWP
It’s a little known payment top-up that’s only paid to state pensioners aged over 80 who retired before 2016, but a 25 pence top up for older pensioners is still being paid out by the DWP in 2026.
The DWP has included the 25p ‘addition at age 80’ payout for pensioners on the old basic state pension in its benefits list for April 2026 onwards, but the payment is to remain frozen at the same rate.
Similar to the controversial £10 Christmas bonus, the 25p payment has never been adjusted for inflation since it was first introduced in 1971. At the time, pensions were £6 per week, so 25p represented a 4% boost.
Personal Allowance – HMRC
The standard Personal Allowance threshold refers to the amount of income you can earn before having to pay tax on it and it is currently set at £12,570. From April 2026, this rate will remain frozen at the same level.
Those who earn between £12,571 and £50,270 will pay a tax rate of 20%, those who earn between £50,271 and £125,140 will pay a 40% tax rate, and those who earn over £125,140 will pay a 45% tax rate.
If your income is more than £100,000 it decreases, so for every £2 you earn above this amount you lose £1 of your tax-free Personal Allowance.
Christmas Bonus – DWP
The government has confirmed there are no plans to increase the £10 Christmas Bonus for 2026, meaning it will remain frozen at its current level for another year. The payment has been fixed at the same amount it was when first introduced in 1972.
Higher income tax band – HMRC
The higher income tax band rate will remain frozen at £50,270 for the 2025/26 tax year. It means that those who earn between £50,271 and £125,140 must pay 40% tax on the amount of income earned above the standard Personal Allowance threshold of £12,570.
In the 2025 Budget, Ms Reeves announced that both the Personal Allowance threshold and the higher rate income tax threshold would be frozen for a further three years, up to April 2031. The additional rate threshold will also be frozen for this period.
HM Treasury said: “The government is maintaining the income tax Personal Allowance at £12,570 and higher rate threshold at £50,270 from April 2028 to April 2031. The additional rate threshold remains at £125,140 from April 2028 to April 2031.
“The Personal Allowance threshold applies UK-wide. The higher rate threshold for non-savings, dividend and property income and for property income will apply to taxpayers in England, Wales and Northern Ireland, and for savings and dividend income it will apply UK-wide. This will be legislated for in Finance Bill 2025-26.”
