Ally
As the cost of living crisis continues to affect millions across the UK, the government has announced a £250 cost of living payment for households earning under £40,000 annually.
This much-needed support is part of the seventh phase of the Household Support Fund, which has now been extended to 31 March 2026.
Backed by the Department for Work and Pensions (DWP) and administered through local councils, the initiative is designed to help struggling families cover essential daily expenses and maintain financial stability during challenging times.
What Is the £250 Cost of Living Boost?
The £250 cost of living payment is a one-off, means-tested support grant targeting households most at risk of hardship.
Unlike universal payments, eligibility is determined by individual councils based on central funding criteria.
This payment helps with a wide range of basic needs, including:
- Food and energy bills
- Water and housing costs
- Phone and internet charges
- Transport or clothing expenses
- White goods like fridges and washing machines (provided in-kind)
Importantly, some councils will offer direct item provision (such as white goods), rather than a cash payment, to ensure funds are used for essential needs.
Eligibility Criteria for the £250 Payment
To qualify, applicants must meet strict income and asset thresholds and demonstrate financial hardship. Each local authority has the discretion to tailor support, but the general framework is as follows:
Eligibility Summary
| Eligibility Criteria | Details |
|---|---|
| Household Income | Less than £40,000 per year (net) |
| Savings Threshold | Less than £1,000 |
| Residency Requirement | Must live in a participating council area |
| Proof of Hardship | Must demonstrate financial difficulty |
| Required Documentation | Income proof, bank statements, utility bills |
Enfield Council, for example, specifies that applicants must provide bank statements, evidence of income, and utility bills to qualify for energy or water bill support.
Other councils have slightly different documentation requirements but follow the same general structure.
Who Else Can Get the £250 Support?
In addition to the income-based eligibility, certain benefit recipients will also qualify for the £250 payment, provided they were receiving any of the following between 15 January and 28 February 2025:
- Universal Credit
- Income-based Jobseeker’s Allowance
- Income-related ESA (Employment and Support Allowance)
- Income Support
- Working Tax Credit
- Child Tax Credit
- Pension Credit
- Personal Independence Payment (PIP)
- Disability Living Allowance (DLA)
- Attendance Allowance
This marks the first time that claimants of PIP, DLA, and Attendance Allowance have been included in the scheme, acknowledging the extra costs borne by individuals with long-term illnesses or disabilities.
Payment Schedule and Method
Families eligible for the £250 cost of living payment can expect the funds between 17 July 2025 and 30 July 2025.
Payment Information:
- Payment Window: 17 July 2025 – 30 July 2025
- Payment Method: Direct deposit to bank accounts
- Delays: Minor delays may occur, but most payments will be completed by the first week of August 2025
No cheques or vouchers will be issued. Households are advised to ensure their bank details and contact information are updated with their local council.
Why This Support Matters
Inflation continues to impact energy, housing, and grocery prices, leaving low- and middle-income families in financial distress. The £250 payment is designed to:
- Prevent families from falling behind on utility or rent payments
- Help cover essential needs like food and transportation
- Support vulnerable groups at higher risk of financial crisis
The DWP’s decentralised approach gives councils the flexibility to address region-specific needs, while maintaining a national framework of support.
What You Should Do Now
If your household income is under £40,000, take these steps immediately:
- Check your local council website for application procedures
- Gather your supporting documents such as income proof and utility bills
- Submit your application early to avoid delays in processing
Early preparation ensures a smoother process and timely disbursement of the £250 grant when the payment window opens in July 2025.
The £250 cost of living payment offers timely, targeted support to help UK families manage rising expenses.
If your income is below £40,000, ensure you check your council’s website and prepare your documents in advance to receive this essential payment in July 2025.
FAQs
Who qualifies for the £250 cost of living payment in July 2025?
Households earning under £40,000 per year or receiving qualifying benefits like Universal Credit, PIP, ESA, or Child Tax Credit.
How will the payment be issued?
The payment will be made by direct bank transfer between 17 July and 30 July 2025. No vouchers or cheques will be used.
What documents are needed to apply?
Most councils require proof of income, recent bank statements, and utility bills to verify eligibility and hardship.