Advising low income families in Scotland Ebulletin January 2026

IN THIS ISSUE:

• Abolition of two-child limit
• Benefit cap
• Child benefit

Abolition of two child limit

The UK government announced in the November 2025 Budget that the ‘two-child limit’ will be removed from April 2026. The two-child limit currently means that a child element (£292.81 a month) is not payable for children born on or after 6 April 2017 where there are already two or more children included in the universal credit (UC) award. There are exceptions for multiple births, adoption, non-parental caring arrangements and non-consensual conception. From April 2026, the two-child limit will be completely removed, so that a child element is payable for all children for whom the claimant is responsible. It will no longer be necessary to fall into any of the exceptions. Families already getting UC should not need to apply but should check that all their children are recorded on their UC journal. Some families whose income was previously just too high to qualify for UC may qualify from April. 

As a result of the abolition of the two-child limit at UK level, the Scottish Government is not now going ahead with its planned mitigation payment.

Remember the two-child limit has never applied to child benefit, Scottish child payment, Best Start grants or Best Start foods. 

Benefit cap

A separate policy, ‘the benefit cap’, is not being abolished. The benefit cap limits the total monthly amount of UC a family can receive, and often affects families with three or more children, especially if they are in rented accommodation. The benefit cap is frozen from April 2026, so more families will be affected by it when other benefit rates increase. The removal of the two-child limit may mean that families affected by the benefit cap do not receive an increase in their UC in full. 

Families with three or more children should:

• Make sure that all their children have been recorded on their UC claim so that the additional child element(s) become payable.
• Be aware that the additional child element may mean that they are affected by the benefit cap if total UC and child benefit (and some other benefits such as JSA, ESA, maternity allowance) adds up to more than £1,835 a month.
• Check if they are exempt from the benefit cap – it does not apply to families in work (earning over monthly equivalent of 16 hours a week at the ‘national living wage’) or where an adult or child is in receipt of a disability benefit, or carer support payment, carer element, or the limited capability for work-related activity element.
• Apply for a discretionary housing payment from their local authority if they are affected by the benefit cap. The Scottish Government intends that this should mitigate the benefit cap, but it can only be paid to households who are liable for rent, not, for example, owner-occupiers or people living with extended family.

See https://www.gov.uk/benefit-cap for more information.

Child benefit

Since 1 September 2025, The Child Benefit (Miscellaneous Amendments) Regulations 2025 amended the child benefit rules to: 

• remove the requirement that education being provided to a young person outside a school or college must have begun before the young person turned 16;
• allow a young person to be treated as being in ‘full-time education’ where they are participating in non-advanced education for 12 hours or less a week due to an illness or disability.

These changes do not apply to UC. For UC purposes, education must be provided at a school, college or elsewhere approved by the Secretary of State, and the average time spent receiving tuition, engaging in practical work or supervised study or taking examinations must exceed 12 hours a week during term time.

For more information on the differences between child benefit and UC child element, there is an article for CPAG subscribers on https://askcpag.org.uk/content/212740/not-joined-up