As households across the UK brace for another costly winter, the government has stepped in with an additional £250 Cost of Living Payment scheduled for September 2025. With rising prices for food, energy, and essential household bills still squeezing family budgets, this one-off payment aims to provide much-needed relief for low-income households, pensioners, and certain benefit claimants.
Unlike loans or repayable advances, this support is tax-free, non-repayable, and does not affect other benefits. For millions, it represents an important cushion to help cover daily expenses at a time when every pound counts.
What Is the £250 Cost of Living Payment?
The £250 Cost of Living Payment is part of the UK Government’s ongoing package of financial support designed to protect the most vulnerable from inflationary pressures.
- It is a one-off payment.
- It does not affect existing entitlements such as Universal Credit, Pension Credit, Winter Fuel Payments, or Cold Weather Payments.
- It is not taxable and will not reduce any means-tested benefit eligibility.
The scheme is particularly aimed at those struggling with the double challenge of rising grocery bills and higher energy costs, both of which remain stubbornly above pre-pandemic levels.
Why the Government Is Offering This Payment
Since 2022, inflation has eroded the purchasing power of millions of households. While the overall rate has started to cool, essential items like fuel, electricity, and food remain significantly more expensive than just a few years ago.
The government recognises that these pressures disproportionately affect:
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- Low-income households relying on state support.
- Pensioners, particularly those living on fixed incomes.
- People with disabilities who face higher everyday costs.
By timing the payment for September 2025, ministers hope to ease the burden just before the autumn and winter seasons, when heating and electricity bills spike.
Who Is Eligible for the £250 Cost of Living Payment?
Eligibility depends on receiving specific means-tested benefits during the qualifying period set by the Department for Work and Pensions (DWP) or HM Revenue and Customs (HMRC).
You may qualify if you are entitled to one of the following:
- Universal Credit
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Pension Credit
- Working Tax Credit
- Child Tax Credit
Important: If you only receive New Style ESA, New Style JSA, or contribution-based benefits without an income-related element, you will not qualify.
Payment Dates for September 2025
The DWP has confirmed that eligible households will begin receiving the £250 payment from 16 September 2025, with all payments expected to be distributed by 30 September 2025.
- Those who receive only Tax Credits (without other DWP benefits) will be paid slightly later by HMRC, likely in early October 2025.
- Payments are sent in batches, so do not be alarmed if others receive theirs earlier.
How You Will Receive the Payment
The £250 will be paid automatically into the bank account where you usually receive your benefits or pension.
On your bank statement, it will appear under a reference such as:
- “DWP COLP” (if paid by DWP)
- “HMRC COLP” (if paid by HMRC)
There is no need to apply, fill in forms, or contact the government in advance.
What To Do if You Do Not Receive the Payment
Most eligible households will get the payment automatically. However, if by early October 2025 you have not received it, you should:
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- Double-check your bank account for any new deposits.
- Review your benefit entitlement dates to confirm you qualified during the reference period.
- Contact the DWP or HMRC helpline if you suspect you were missed.
- From October 2025, an official online form will be available to report missing payments.
Support for Pensioners
Pensioners are among the groups most impacted by rising energy bills. Those who qualify for Pension Credit will automatically receive the £250 payment.
Even if you are not currently receiving Pension Credit, you may still be eligible by making a late claim. This could not only secure the Cost of Living Payment but also unlock other benefits such as:
- Help with NHS costs.
- Discounts on council tax.
- Access to additional winter energy support.
The government strongly encourages all pensioners on low incomes to check their entitlement.
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Support for People With Disabilities
While this payment primarily targets low-income households, some people with disabilities may qualify if they also receive Universal Credit or income-related ESA.
Additionally, the government is considering separate disability Cost of Living Payments later in 2025. If you qualify for both, you may receive multiple forms of support.
Other Options if You’re Not Eligible
Not everyone will meet the criteria for the September payment. However, several other forms of assistance remain available:
- Household Support Fund (via local councils).
- Winter Fuel Payment for pensioners.
- Cold Weather Payments during extreme winter conditions.
- Warm Home Discount Scheme to offset heating costs.
Households should also check with energy suppliers and local authorities for additional hardship schemes.
How To Use the £250 Wisely
The Cost of Living Payment is intended to help households with essential expenses. Many families are expected to put it toward:
- Rising energy bills ahead of winter.
- Basic groceries and food supplies.
- Travel and fuel costs, particularly for commuting.
- Urgent household maintenance or appliance repairs.
Experts recommend making a budget in advance so the payment goes towards covering the most pressing needs.
Impact on Existing Benefits
One key reassurance is that the £250 payment will not:
- Reduce your Universal Credit or Pension Credit.
- Count as taxable income.
- Affect your eligibility for other means-tested benefits.
It is treated as a standalone one-off payment, ensuring that households keep their full entitlement to other government support.
5 FAQs
Q1. Who will receive the £250 Cost of Living Payment in September 2025?
Anyone on income-related benefits such as Universal Credit, Pension Credit, Income Support, or Tax Credits may qualify.
Q2. Do I need to apply for the September 2025 Cost of Living Payment?
No. Payments are automatic and go directly to the bank account used for your benefits or pension.
Q3. When will the £250 payment be made?
Payments will be sent between 16 and 30 September 2025, with Tax Credit-only claimants receiving theirs by early October.
Q4. Will this payment affect my other benefits?
No. The £250 is tax-free, non-repayable, and does not reduce any other benefit entitlements.
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Q5. What should I do if I don’t get my payment?
Check your bank account and benefit entitlement. If still unpaid by early October, contact DWP or HMRC, or use the official missing payment form once it becomes available.
