With everyday expenses continuing to climb, the UK government is stepping in once again with extra support. The new £250 Cost of Living Payment, scheduled for September 2025, offers crucial relief to millions of low-income households. It’s automatic, tax-free, and targeted — so if you’re already receiving certain benefits, you may be getting this payment without lifting a finger.
This guide explains who qualifies, when you’ll receive it, what to look out for, and how to make the most of it.
Overview
Let’s start with the basics of this government support:
| Feature | Details |
|---|---|
| Payment Amount | £250 (one-off, tax-free) |
| Payment Window | 6 to 22 September 2025 |
| Eligible Benefits | UC, Pension Credit, Tax Credits, JSA, ESA, IS |
| Application Required | No – it’s automatic |
| Payment Method | Direct deposit into your usual bank account |
| Reference Code | “DWP COL” or “HMRC COLS” |
| Extra Help Available | Disability Payment, Winter Fuel, HSF |
| Official Info | GOV.UK Cost of Living Support |
Purpose
Why is this payment happening now?
Inflation is still a serious concern in the UK. Since 2021, food prices have gone up over 25%, and energy costs soared by 50% in some regions during 2023. Even as inflation cools slightly, many families are still feeling the squeeze.
To help ease these pressures, the government is issuing another round of cost of living support. The £250 payment builds on similar help from previous years — like the £900 in 2023 — and is aimed at protecting the most vulnerable households during tough times.
Eligibility
You’ll be eligible for the £250 Cost of Living Payment if, during the qualifying period (usually a few weeks before September), you receive at least one of the following benefits:
- Universal Credit
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Working Tax Credit
- Child Tax Credit
- Pension Credit
Note:
You won’t qualify if you only receive New Style JSA, New Style ESA, or contribution-based benefits — unless these are combined with one of the above qualifying benefits.
Payment
The good news? There’s nothing you need to do. If you’re eligible, the payment will land in your account automatically.
- Amount: £250
- Payment Dates: Between 6 and 22 September 2025
- Where It Goes: Same bank account where you get your regular benefits
- Reference Codes:
- “DWP COL” for DWP-managed benefits
- “HMRC COLS” for those receiving Tax Credits
Warning
Watch out for scams. Neither DWP nor HMRC will ever contact you by email, phone, or text asking for your personal or banking details regarding cost of living payments.
If you get a suspicious message, delete it — and never click any links.
Smart Use
Not sure how to best use the £250? Here are some smart ways to stretch your money:
- Pay down energy arrears or other high-priority bills
- Stock up on non-perishable groceries
- Buy winter clothing or school uniforms early
- Set aside part of it for emergency savings
- Invest in small energy-saving home upgrades
Sarah from Manchester
Sarah, a single mum on Universal Credit, used last year’s cost of living help to pay down an electric bill, grab discounted school uniforms, and even save a bit for Christmas.
“That money helped me breathe a little easier,” she said.
Extras
Alongside the £250, you may also qualify for these other programs:
- £150 Disability Payment – if you receive disability benefits
- Winter Fuel Payment – for pensioners, usually £150–£300
- Household Support Fund (HSF) – council-managed support for essentials like food, clothing, and energy bills
Check with your local authority or GOV.UK to see if you’re eligible for these as well.
The £250 Cost of Living Payment in September 2025 won’t solve every financial struggle, but it can make a real difference when used wisely. It’s fast, automatic, and designed to ease immediate pressure — especially as we head into colder months. Make sure your bank details are up to date, and keep an eye on your account during the payment window.
FAQs
Do I need to apply for the £250 payment?
No, the payment is automatic if you’re eligible.
When will I get the £250?
Between 6 and 22 September 2025.
Who qualifies for the £250 payment?
People receiving UC, JSA, ESA, Tax Credits, or Pension Credit.
Will this affect my other benefits?
No, it’s tax-free and doesn’t impact other benefits.
How can I avoid scams?
Don’t share info via text or email—DWP/HMRC never ask for it.
