Who gets a work allowance
You get a work allowance if your UC award includes a child element (you have children) or a health element (LCWRA). That is it. If you are a single claimant with no children and no health condition limiting your capacity for work, you do not get a work allowance. For couples, the allowance applies to the household if either of those elements is in payment.
The two work allowance rates in 2026/27
There are two rates depending on whether your UC includes a housing cost element. If UC includes housing costs, the work allowance is £427 per month. If it does not (for example because you live with family or in a property you own outright), the work allowance is £710 per month. The higher allowance for those without housing support recognises that their UC award is lower and they face different costs.
How the taper interacts with the work allowance
Once your earnings exceed the work allowance, the 55% taper applies to the excess. You keep 45p of every £1 above the work allowance. If your work allowance is £427 and you earn £800, the earnings above the work allowance are £396. The taper reduces UC by £396 x 55% = £217.80. Compare this to a household without a work allowance earning £800: the full £800 is subject to the taper, reducing UC by £440.
Childcare costs and the work allowance
If you are working and paying registered childcare costs, you can claim the UC childcare element on top of the work allowance. UC covers up to 85% of eligible childcare costs (with monthly caps). The childcare element and the work allowance interact positively: you get the full work allowance before the taper applies, and separately claim back the majority of childcare costs.
Worked example: work allowance in action
Maria is a single parent with one child, receiving UC with housing costs. Her work allowance is £427. She earns £900 from part-time work. Her base UC award (before earnings) is £1,100. Earnings above the work allowance: £900 - £427 = £496. Taper deduction: £496 x 55% = £272.80. Monthly UC: £1,100 - £272.80 = £827.20. Maria also receives UC childcare support for her registered childminder costs. Combined income from work and UC is higher than out-of-work UC, which is the intended effect of the allowance.