Advising low income families in Scotland update April 2026

The latest update from CPAG in Scotland's service supporting those working with low-income families in Scotland, including lone parents, young parents, low-paid workers, and families affected by violence or imprisonment.

Increases to Scottish payments for children

From 1 April 2026, the rates of Scottish benefits for children have increased as follows:

  • Scottish child payment from £27.15 to £28.20 a week
  • Best Start foods from £5.40 to £5.60 a week
  • Best Start grant pregnancy and baby payment from £767.50 to £796.65 (or from £383.75 to £398.35 if another child under 16 in the family)
  • Best Start grant early learning payment from £319.80 to £331.95
  • Best Start grant school age payment from £319.80 to £331.95 (available from 1 June)

Entitlement to any amount of universal credit is enough to qualify for these payments. These payments are not included in the benefit cap and are payable as well as universal credit child elements and child benefit.

For increases to all Scottish benefits, see The Social Security Regulations 2026.

DWP guidance on abolition of two-child limit

The DWP has issued a guidance memo for decision-makers on the abolition of the two-child limit in universal credit from 6 April 2026. This confirms that a child element will be included for any child or qualifying young person for whom the claimant is responsible in assessment periods starting on or after 6 April 2026. Claimants must therefore ensure they have reported all their children and check they are included in the award. Note this means it will be May before claimants see an increase in their payments. See Removal of the Two Child limit.

Benefit cap reminder

The DWP guidance memo for decision makers does not mention the benefit cap, which is frozen at £1,835 a month for lone parents or couples outside Greater London. Most families with three or more children will now find that their basic entitlements to universal credit and child benefit exceed the benefit cap, so their UC may not increase by the full amount of additional child elements (£303.94 a month). However, the benefit cap does not apply to families who fall under any of the exemptions:

  • earning over the monthly equivalent of 16 hours a week at the ‘national living wage’ (£881 a month from April 2026);
  • have been working at that level for a year, the benefit cap is not applied for a grace period of 9 months;
  • 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;
  • entitled to guardian’s allowance, industrial injuries disablement benefit, war pensions

It is vital that this information is included in the UC journal so that payments are not limited by the benefit cap.

If a family is not exempt from the benefit cap, they should apply to their local authority for a discretionary housing payment (DHP). The Scottish Government has committed to mitigating the benefit cap as fully as possible. See para 6: Scottish Discretionary Housing Payments: guidance manual 2025

Caselaw update

Child benefit priority rules

HMRC and MC v SC (CHB): [2026] UKUT 30 (AAC) 

In cases of shared care between separated parents, claimants can jointly elect who should be paid - a joint election of this kind must be in writing (or by telephone) and must be notified to HMRC. If they cannot agree, HMRC must use its discretion to decide who is entitled, and this decision is not appealable.

DL v HMRC UA-2024-SCO-000089-CHB

The issue of where a child is living was not to solely be equated with where the child spends the majority of their time. An absence of care and control over the child during what one parent claimed was a temporary arrangement was clearly a relevant factor in deciding the child had started living with the other parent. The facts that one parent had some of the child’s possessions, was the address on her medical records and paid for her activities do not lead to a conclusion that the appellant must have been the only parent with whom the child was living at the relevant time.

Guardian’s allowance

HMRC v JA (GA): [2026] UKUT 55 (AAC)

Guardian’s allowance depends on showing that when one of the child’s parents died, the claimant was unaware of, and has failed after all reasonable efforts to discover, the whereabouts of the other parent. In this case, the claimant stated on the form that he knew the whereabouts of the children’s father. On that basis HMRC refused the application. On his appeal, the claimant said that he had misunderstood the meaning of “whereabouts”, and that he only knew the general geographical area in which the father lived but not his address. The tribunal had accepted this without considering whether he had made reasonable efforts to discover the whereabouts of the other parent, which was an error of law.

UC childcare costs

SSWP v YN (UC): [2026] UKUT 58 (AAC)

The claimant reported two payments of childcare costs that she made in one assessment period, which were for childcare provided in the current and previous assessment period. The DWP had restricted the amount of the childcare element to the maximum payable in the current assessment period. The First-tier tribunal had sought to reallocate one of the payments to the previous assessment period. However, the Upper Tribunal judge found, with regret, that the law does not allow for this, as the charges were attributable to the assessment period in which they were paid, not the one in which the childcare was provided. The message for parents is to ensure that they pay for childcare in the UC assessment period in which it is provided, if possible.