The Department for Work and Pensions (DWP) has announced a major change to Carer’s Allowance that will benefit thousands of unpaid carers across the UK. From April 2025, the earnings threshold for Carer’s Allowance will increase from £151 to £196 per week—a rise of £45, the largest cash increase ever for this benefit.
The change is expected to allow over 60,000 more people to qualify for Carer’s Allowance by the 2029/2030 tax year.
Let’s break down what this means, who qualifies, and what else carers should be aware of.
What Is Carer’s Allowance?
Carer’s Allowance is a payment offered by the UK government to unpaid carers who look after someone with a disability or long-term health condition for at least 35 hours a week.
Currently, you can receive £81.90 per week (2025 rate), but you must earn below the weekly earnings threshold to qualify. Until now, that limit was £151 per week, after deductions like tax and National Insurance.
From April 2025, this limit increases to £196 per week, making it easier for carers in part-time or low-paid jobs to continue receiving support.
Why the Change Matters
Labour MP and DWP Minister Andrew Western said the change shows the government’s commitment to recognising the “vital contribution” unpaid carers make in supporting elderly and disabled people.
“This is the biggest-ever cash increase in the Carer’s Allowance earnings threshold,” Mr Western said. “It will give more carers the ability to earn a little more without losing their entitlement.”
Overpayment Review Launched for Past Carer’s Allowance Cases
The DWP has also launched an independent review into overpayments of Carer’s Allowance caused by people unintentionally breaching the earnings limit.
- Some carers accidentally earned more than the limit, resulting in overpayment debts.
- The review will look into how these overpayments happened, how carers can be supported, and how future issues can be prevented.
- The findings are expected by summer 2025, and the review is led by Liz Sayce OBE.
Carers and organisations are encouraged to submit feedback to help shape future recommendations.
Support for Carers with Overpayments
Mr Western confirmed that the DWP is committed to working with anyone struggling with repayment plans and will offer affordable, flexible options.
The DWP has also started text message reminders to help carers report changes to their income, aiming to reduce future overpayment risks.
Overpayments can include people who:
- No longer receive Carer’s Allowance
- Are no longer carers
- Made incorrect or fraudulent claims
The new £196 earnings threshold for Carer’s Allowance is a much-needed boost for those who balance work and caring responsibilities. It helps ensure that carers can continue working part-time without fear of losing vital support.
At the same time, the review into overpayments shows the DWP is recognising past issues and working toward a more supportive and fair system. With flexible repayment plans and better communication, carers will be better protected going forward.
If you’re an unpaid carer, now is a good time to check your earnings, keep your records up to date, and prepare for the new rules in 2025.
FAQ’s
What is the new Carer’s Allowance earnings threshold from April 2025?
From April 2025, the Carer’s Allowance earnings limit will increase to £196 per week, allowing more carers to qualify for financial support.
Who is eligible for Carer’s Allowance in the UK?
You must be caring for someone at least 35 hours per week, earning under the threshold, and the person you care for must receive certain disability benefits.
How many people will benefit from the new Carer’s Allowance rules?
The DWP says over 60,000 more people will qualify for Carer’s Allowance by 2029/2030 due to the increased earnings threshold.
What is the DWP doing about Carer’s Allowance overpayments?
An independent review has begun to understand how overpayments occurred and how to better support those who received them, with findings due by summer 2025.
What should I do if I have a Carer’s Allowance overpayment?
The DWP encourages affected individuals to get in touch. They offer affordable and flexible repayment options based on your financial situation.
