£500 One‑Off Support Payment: In 2025, the UK government has introduced a special one-off £500 One‑Off Support Payment to provide financial relief to working families hit by rising living costs. Originally funded to offset the discontinued £20‑per‑week boost in Working Tax Credit, this new payment offers a tax-free lump sum aimed at those who were previously on Tax Credits but who may now be struggling financially. The money will go directly into your bank account — no application needed.
£500 One‑Off Support Payment – Who’s Eligible and What You Need to Know
The £500 One‑Off Support Payment specifically helps families who lost a previous boost to their income following the end of the Working Tax Credit top-up in April 2021. It’s directed at former Tax Credit recipients—especially those who narrowly missed out on higher-tier support. If your situation fits the criteria, HMRC will inform you and automatically arrange the payment based on the account linked to your original claim.
Overview Table
| Payment Type | Timeframe | Amount | Purpose |
| One-Off Support Payment | During 2025 | £500 | Compensation for lost Tax Credit boost |
| Cost of Living – Phase 1 | Mar–May 2025 | £301 | Help with post-winter energy and household bills |
| Cost of Living – Phase 2 | Jul–Aug 2025 | Up to £200 | Aid for summer costs like childcare and cooling |
| Cost of Living – Phase 3 | Oct–Dec 2025 | £500 | Assistance during winter, holiday, and seasonal needs |
Eligibility Criteria
To qualify for this payment, you must have received Working Tax Credit on 2 March 2021, or you must have received Child Tax Credit but not qualified for Working Tax Credit due to slightly higher income. HMRC will check their records and contact eligible households automatically—usually by letter or text. There’s no need to apply, and the money will be paid directly into the bank account used for your tax credit claim.
What Can You Use the £500 For?
This one-off payment is designed to be flexible so that families can use it where it matters most. Whether that’s paying household bills, buying school essentials, or covering rental costs, the money is yours to prioritize. Suggested uses include:
- Paying rent or mortgage charges
- Covering gas, electricity, and water bills
- Buying groceries and essential household items
- Purchasing school uniforms or paying fees
- Purchasing winter clothing or home heating appliances
It’s not a loan, so there’s no need to pay it back. It’s meant to help you get through immediate financial pressure.
Additional Cost of Living Payments in 2025
This £500 support payment is part of a broader package of assistance being rolled out this year:
- Phase 1 (March–May 2025): £301 paid to help with winter energy and other household costs.
- Phase 2 (July–August 2025): Up to £200 to cover summer expenses like cooling and childcare.
- Phase 3 (October–December 2025): Another £500 to assist during winter and holiday spending.
These phased payments aim to smooth support throughout the year and address different seasonal needs.
How Will the £500 Be Paid?
If you’re eligible, you don’t need to do anything. The payment will be sent directly via bank transfer to the account linked to your tax credit claim on file with HMRC. In most cases, this is also the same account used by the Department for Work and Pensions (DWP).
Key Actions to Take:
- Check that HMRC has your current bank details
- Make contact with HMRC or DWP if you’ve changed accounts recently
- Watch for notifications in the mail or by text—it may take a few weeks to arrive
If you haven’t received the payment by the end of 2025 and believe you are eligible, contact HMRC’s support line for clarification.
Final Thoughts
The £500 One‑Off Support Payment is a timely and useful aid for families impacted by the withdrawal of the 2021 Tax Credit top-up. While it’s not a long-term solution, it serves as a much-needed stopgap to help with essential expenses. This payment, along with the three-part Cost of Living support, reflects a broader commitment to helping low-income and working households navigate financial stress.
If you were on Tax Credits as of March 2021 and think you may qualify, make sure your bank information is up to date with HMRC and DWP. Look out for letters or texts confirming your payment, and be prepared to receive the funds without requiring any action on your part.
FAQs
1. Who qualifies for the £500 one-off payment?
You qualify if you were claiming Working Tax Credit on 2 March 2021 or receiving Child Tax Credit but didn’t qualify for Working Tax Credit due to higher income.
2. Do I need to apply to get the money?
No. HMRC will automatically identify eligible households and send the payment without requiring an application.
3. How will I receive the £500?
It will be paid directly into the bank account listed on your previous tax credit claim via a secure bank transfer.
4. What should I do if my bank account has changed?
Contact HMRC or DWP as soon as possible to update your bank details and avoid payment delays.
5. Can this money be used for anything?
Yes. The payment is unrestricted—feel free to use it for rent, utilities, groceries, clothing, child expenses, or other important needs.
