Family Income Benefit Policy

Family Income Benefit Policy: What You Should Know

The UK has a variety of policies in place to help families on a low income. One such policy is Family Income Benefit, which offers support for families with children under 16 who are not working more than 16 hours per week. This post will explore what this policy entails & some options that may be available to you if you qualify for it!
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What Is Family Income Benefit Policy?

In case you’re wondering,

Family Income Benefit is a type of life insurance policy administered by the UK government to help families in need.

It offers financial support for families under 16 of age who are not working more than 16 hours per week or those who cannot work because they have caring responsibility for someone else.

There are two ways you can qualify for this policy:

  • You have a child under 16 who is not working more than 16 hours per week and the gross income of your family (including any benefits) does not exceed £17,850; or
  • You cannot work because you are looking after a person with mental health problems, an intellectual disability, or other need that makes it difficult to look after themselves.

The full amount of their benefit will be included in the calculation even if they live elsewhere. In both cases, there must be no access to state pensions through spouse/partner’s contributions at home or private pension funds held by parents or carer(s).

You see:

There may still be eligibility requirements depending on the circumstances of each case.

A family may also be eligible for this policy term if one or more severely disabled children need care 24 hours a day.

No other person in the household can give enough care for these needs full-time. In all cases, there must not be any access to state pensions through spouse/partner’s contributions at home nor private pension funds held by parents or carer(s).

There may still be eligibility requirements depending on the circumstances of each case.

What Are My Options If I Qualify For This Policy?

Families can apply for this benefit if their circumstances fit the eligibility requirements.

Once qualified, there are two options available: – A monthly payment called Child Tax Credit1 which will provide up £20 extra per Child each week; or – Additional payments called Family Element, which can provide up to £39.55 per week for each child and dependant living in the household.


If your family has a regular gross income of less than £17,850, you will be automatically qualified.

How Does It Work?

It is paid directly to parents who claim the benefit. It can be combined with other benefits such as Working Tax Credit.

In some cases, families cannot have their Child Benefit taken away because they qualify for this policy (i.e., when a child has an intellectual disability).

When that happens, you will still receive all your payments from Family Income Benefit, including any state pension entitlements if eligible.

Simply put:

Your monthly income and other benefits may be calculated to see if you are eligible for this policy. You have the right to appeal against any decision that is made about your application.

Additionally, some exceptions are in place:

Those who qualify for Adult Social Care services2 or those receiving Disability Living Allowance will not usually be qualified because they receive a higher level of support from these sources. However, it is still worth checking with your local office as each case can differ individually.

Does It Cost Anything?

No, it doesn’t cost anything to apply for this policy.

If you would like to know more about Family Income Benefit, don’t hesitate to get in touch with your local office or the Citizens Advice Bureau (CAB3)

What Are The Drawbacks Of This Policy?

The only drawback of this policy is that there are limits on how long someone can receive these benefits based on age or marital status—those under 18 years old must stop receiving family income support after two years unless they start working 16 hours per week continuously; those between 18-24 must stop after one year; those over 25 must stop after two years unless they are looking for work or studying and can show they are making enough progress.


There are waiting lists for receiving this policy, and you may have to wait a long time.

Is It Worth It?

This policy will provide you with guaranteed monthly payments to meet your family’s needs. You may be able to apply for other benefits and combine them if eligible, which can help make the payments go further than they would have otherwise gone on their own.

Even though some limits are in place, it is still worth applying for this benefit because of how much could be received over some time (and not just from the Family Income Benefit).

If approved, then you’ll know that at least one thing is taken care of each month, so you don’t need to worry about where the funds are coming from next year or what might happen when someone passes away and takes their pension with them.

Are There Other Policies That Offer Similar Financial Support?

There is a Working Tax Payment policy, which offers up to £20 per week for parents or carers who work at least 16 hours per week and earn less than the National Minimum Wage of £11 an hour (£172 per month).

The Employment and Support Allowance also provides financial support when someone cannot work because their condition makes it difficult to look after themselves; however, doctors must prove that you have limited capability for employment.

This may not apply if caring responsibility for someone else rather than your disability prevents you from working full-time (see Family Income Benefit Policy).

In addition, some families with children under 18 may receive Family Tax Credit and Child Benefit.

Common Questions

What Is Cover Provided via a Family Income Benefit Policy?

What Information Will You Need Before Applying?

What Type of Assurance Is a Family Income Benefit Plan?

How Long Does Family Income Benefit Pay Out For?

In conclusion

To summarize,

Family Income Benefit is a policy that provides financial support to families on assistance. When applying, you must provide evidence of your employment and income as well as information about any other benefits you may be eligible for so they can assess if you are eligible—then the decision will depend on how much time has elapsed since someone started receiving this benefit or whether there were any breaks in-between periods when recipients returned to work and then stopped working again.


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