Starting Monday, April 7, a major update to the Carer’s Allowance earnings threshold will see thousands of unpaid carers across the UK newly qualify for the benefit. The Department for Work and Pensions (DWP) has announced that carers will now be able to earn more before losing access to this financial support. This means many could receive an additional £333 per month, providing a significant boost to their income.
What’s Changing?
Post Title: Carer’s Allowance Earnings Threshold Update
Country: United Kingdom
New Weekly Carer’s Allowance: £83.30 (up from £81.90)
New Earnings Limit: £196 per week (previously £151)
Eligibility: Must care for someone 35+ hours per week and earn below £196/week
Estimated Impact: 60,000 additional carers expected to qualify
Monthly Support Potential: £333
Official Source: Gov.uk – Carer’s Allowance
Understanding Carer’s Allowance
Carer’s Allowance is a government benefit for individuals who provide unpaid care for someone with substantial health needs or disabilities. To qualify, a carer must devote at least 35 hours a week to caring duties. The person receiving care doesn’t need to be a family member or live in the same household.
Currently, eligible carers receive £83.30 per week. However, eligibility hinges on the carer’s income. If they earn more than the designated threshold in any given week, they lose entitlement for that period.
New Earnings Limit Brings Relief
Until now, the earnings threshold stood at £151 per week, meaning carers could lose their entire benefit by earning just £1 over the limit. As of April 7, this cap will rise to £196 per week, allowing carers to earn an additional £45 weekly without affecting their benefit.
This is a welcome move, as it allows carers to take on a few more hours of work without penalty. It’s also the largest adjustment to Carer’s Allowance since its inception in 1976, enabling recipients to earn nearly £10,000 annually and still receive support.
Who Benefits?
According to DWP estimates, around 60,000 more carers will now qualify for Carer’s Allowance under the new rules. The updated threshold is designed to align with the National Living Wage, equating to about 16 hours of work per week.
Review of Overpayments and System Reform
The policy update follows an independent review initiated in October 2024, led by Liz Sayce OBE. The review addresses widespread issues related to overpayments, where carers have been forced to repay thousands after unintentionally breaching the income limit by small amounts.
The DWP’s so-called ‘cliff edge’ system has long been criticized for its harsh approach, which could see carers lose benefits entirely for exceeding the threshold by as little as £1. The upcoming review, expected to conclude by summer 2025, aims to propose a fairer and more flexible structure.
Broader Benefits Update
Alongside the Carer’s Allowance increase, other benefits such as PIP (Personal Independence Payment) and Universal Credit are also rising in line with inflation (1.7% as of September 2024). The State Pension is going up by 4.1%, in accordance with the triple lock policy—whichever is highest among inflation, wage growth, or 2.5%.
Mixed Reactions from Carers UK
While the earnings threshold increase has been welcomed, Carers UK remains concerned about recent proposals that may reduce eligibility for PIP. These changes could affect up to 150,000 carers, potentially stripping them of their financial support.
Helen Walker, Chief Executive of Carers UK, stated:
“While the rise in the earnings limit is a much-needed step forward, the recent PIP proposals could significantly harm carers already under pressure.”
The charity is urging the government to conduct a complete review of Carer’s Allowance, focusing on its adequacy and the long-term needs of carers who can’t combine caring with paid work.
Frequently Asked Questions (FAQs)
1. Who will benefit from the earnings threshold increase?
An estimated 60,000 unpaid carers will now become eligible for Carer’s Allowance due to the rise in the earnings limit to £196 per week.
2. What is the current rate of Carer’s Allowance?
As of April 2025, the weekly amount is £83.30, up from £81.90.
3. How does this affect eligibility?
Carers earning up to £196 per week can now continue receiving the benefit—this equals around 16 hours of work at National Living Wage.
4. Why was Carer’s Allowance criticized previously?
The strict earnings cap meant losing full benefits for earning even £1 over the limit, leading to many unexpected overpayments and hardship.
5. Are other benefits increasing too?
Yes, DWP benefits like PIP and Universal Credit are increasing in line with inflation, and the State Pension is also rising by 4.1%.
Final Thoughts
The increased earnings threshold for Carer’s Allowance marks an important shift in support for unpaid carers. It eases the financial burden, allows for greater flexibility in employment, and helps thousands maintain critical income while caring for loved ones.
Still, further reforms are needed to ensure all carers—especially those unable to work—receive the financial support they deserve.
For more updates and detailed information, visit the official Carer’s Allowance page on Gov.uk.