What it means for youFamily & life stages
The Carer's Allowance earnings cliff edge is set to end. What changes for unpaid carers
The government says carers who earn a little over the limit will soon keep part of their £86.45 a week instead of losing all of it. No start date has been given yet.
Published 27 October 2026Last checked 27 October 2026England, WalesFrom HM Treasury and Department for Work and Pensions
Illustration generated with AI
What's happening
Right now, a carer who earns even a penny over £204 a week (after tax, National Insurance and expenses) loses their whole Carer's Allowance of £86.45 a week. On 26 October 2026 the government announced it intends to replace this with a taper, so carers lose £1 of allowance for each £1 they earn over the limit. It has not said when this will start, so the current rule still applies for now.
The question: What does the planned end of the Carer's Allowance earnings cliff edge mean for unpaid carers who work, and what are the rules until it starts?
The policy
- Announced by
- HM Treasury, with the Department for Work and Pensions
- Announced on
- 26 October 2026
- Stage
- announced
- Takes effect
- Not yet announced
- Part-time worker earning £210 a week after deductions, no other benefits: Today gets no Carer's Allowance. Under the taper would keep £80.45 a week.
£210 minus £204 is £6 over. £86.45 minus £6 is £80.45 (illustrative calc).
- Carer on Universal Credit earning £215 a week: Would keep £75.45 of Carer's Allowance, but Universal Credit is reduced by the same amount, so household income changes little.
£215 minus £204 is £11 over. £86.45 minus £11 is £75.45 (illustrative calc).
- Carer earning £300 a week after deductions: Gets nothing under either rule, because £96 over the limit is more than the full allowance.
£300 minus £204 is £96, which is more than £86.45 (illustrative calc).
This applies to you if…
- You care for someone for at least 35 hours a week
- The person you care for gets a qualifying disability benefit, such as the daily living part of Personal Independence Payment or Attendance Allowance
- You do paid work, or would like to take on more hours
- You live in England or Wales (Scotland and Northern Ireland have their own systems)
Not for you if…
- Carers who earn well over the limit, since the taper still reduces the allowance £1 for £1
- Carers whose State Pension is £86.45 a week or more, who do not receive a Carer's Allowance payment anyway
- Carers in Scotland, who claim Carer Support Payment from Social Security Scotland instead
What it's worth
Carer's Allowance £86.45 a week and earnings limit £204 a week after tax, National Insurance and expenses, as shown on GOV.UK in October 2026. Taper of £1 for every £1 earned over the limit, as announced by HM Treasury on 26 October 2026. Start date and final rules not yet published.
Tax year 2026 to 2027 figures
Illustrative calc: a carer earning £214 a week
- The earnings limit is £204 a week after tax, National Insurance and expenses.
- She earns £214 a week, which is £10 over the limit.
- Under the current rule, going over the limit means no Carer's Allowance that week, so she gets £0.
- Under the announced taper, £1 of allowance is lost for each £1 over the limit. £86.45 minus £10 is £76.45.
- Over a year, £76.45 a week is about £3,975.
About £76.45 a week instead of nothing
Illustrative calc only, using the taper as the Treasury described it. The final rules, including the limit used and the start date, have not been published.
How to do it
- 1
Check the current earnings rule
Today the limit is £204 a week after tax, National Insurance and expenses. GOV.UK explains what counts as earnings and which expenses can be taken off.
Takes about 10 minutes
- 2
Report changes in your earnings straight away
Until the taper starts, earning over the limit stops your allowance for that period. Reporting quickly helps you avoid an overpayment you would have to pay back.
Takes about 15 minutes
- 3
If you have not claimed, check whether you can
You can claim online. You do not have to be related to, or live with, the person you care for.
Takes about 30 minutes
- 4
The announcement came just before the Budget on 28 October 2026. Look for the start date and how the taper will work on the DWP pages.
Deadline
No start date announced yet
The current all-or-nothing rule applies until the government confirms otherwise.
The catches
It has not started
The government says it intends to end the cliff edge. Until a start date is set, earning over £204 a week after deductions still means losing the whole allowance for that week.
Universal Credit takes it back
If you get Universal Credit, it is reduced by the same amount as your Carer's Allowance. So keeping some Carer's Allowance may change your total income very little. You may still get the carer amount in Universal Credit.
State Pension overlap
If your State Pension is £86.45 a week or more, you do not get a Carer's Allowance payment. If you get Pension Credit, it can increase instead when you are eligible for Carer's Allowance.
The 35 hours rule stays
Nothing in the announcement changes the other conditions, such as caring for at least 35 hours a week and not studying for 21 hours or more.
Illustrative example
A carer offered an extra shift
Priya cares for her father, who gets Attendance Allowance, for more than 35 hours a week. She works part time and earns £200 a week after tax and National Insurance. Her manager offers one extra short shift that would take her to £220 a week.
- Today she gets £200 in pay plus £86.45 Carer's Allowance, about £286.45 a week.
- Under today's rule, £220 is £16 over the limit, so she would lose all of her Carer's Allowance that week and have £220.
- Under the announced taper she would lose £16 of allowance and keep £70.45, so her week would total about £290.45.
Today the extra shift leaves her about £66 worse off. Under the taper it would leave her about £4 better off.
Illustrative example. Names and details are made up. It assumes the taper works as the Treasury described and that she gets no other benefits.
What this means for…
- Caring for someone: If you work part time, the taper could let you keep part of your allowance when your pay goes a little over £204 a week.
- Get benefits: If you get Universal Credit, any Carer's Allowance you keep is taken off your Universal Credit, so the gain may be small.
- Self-employed: Earnings from self-employment count after tax, National Insurance and expenses, so a busier week could take you over the limit.
Common misreadings
You might hear: Carers can now earn as much as they like and keep their allowance.
Actually: The taper takes away £1 of allowance for each £1 over the limit. Someone earning about £86 or more over the limit would still get nothing.
You might hear: The change has already started.
Actually: It was announced on 26 October 2026 with no start date. The current rule still applies.
You might hear: The allowance itself is going up.
Actually: The weekly rate stays £86.45. What changes is what happens when you earn just over the limit.
Where the UK nations differ
- England and Wales
- Carer's Allowance is run by the DWP. The announced taper is a change to this benefit.
- Scotland
- People in Scotland apply for Carer Support Payment from Social Security Scotland instead, up to £86.45 a week, with a Scottish Carer Supplement of £11.70 a week on top. The announcement does not say whether Scotland will adopt a taper. That is a matter for the Scottish Government.
- Northern Ireland
- Carer's Allowance is run separately, with the same £86.45 rate and £204 earnings limit. The announcement does not say when or whether Northern Ireland will follow.
What you could do
get Carer's Allowance and your earnings go up and down
Keep reporting earnings changes straight away, because the current rule still applies.
stopped claiming because your earnings were just over the limit
care for someone 35 hours a week and have never claimed
Check the eligibility rules. You do not need to live with the person you care for.
Timeline
26 October 2026
Taper announced
HM Treasury says carers will lose £1 for every £1 earned over the limit, instead of the whole allowance.
28 October 2026
Autumn Budget
More detail may follow. No start date had been given before the Budget.
The detail
The rules
- Carer's Allowance is £86.45 a week for people caring at least 35 hours a week for someone on a qualifying benefit.
- The earnings limit is £204 a week after tax, National Insurance and expenses.
- The Treasury says the limit is equivalent to 16 hours at the National Living Wage.
- Universal Credit is reduced by an amount equal to Carer's Allowance.
- You cannot get a Carer's Allowance payment if your State Pension is £86.45 a week or more.
- DWP is reassessing Carer's Allowance overpayments from 10 April 2015 to 2 September 2025. Affected people do not need to contact the Carer's Allowance Unit.
References
- HM Treasury press release, 26 October 2026: Ending the cliff edge, so only £1 of support tapers away for every additional £1 earned.
- GOV.UK Carer's Allowance eligibility: Earnings of £204 or less a week after tax, National Insurance and expenses.
Words explained
- Cliff edge
- A rule where going a tiny bit over a limit means losing the whole payment.
- Taper
- A rule that reduces a payment gradually as income rises, instead of all at once.
- Weekly Earnings Limit
- The most you can earn each week, after tax, National Insurance and allowed expenses, and still get Carer's Allowance. It is £204 now.
- Overpayment
- Money paid to you that you were not entitled to, which you usually have to pay back.
In short
Carer's Allowance is £86.45 a week, but earning a penny over £204 a week after deductions wipes it out. The government plans to change this so you lose £1 for each £1 over. It hasn't said when, so keep reporting your earnings under the current rules for now.
Sources
- Everyday fixes to make life easier for millions of Britons, HM Treasury (2026-10-26)
- Carer's Allowance: eligibility, GOV.UK
- Carer's Allowance: how it works, GOV.UK
- Carer's Allowance: effect on other benefits, GOV.UK
- Report a change to your Carer's Allowance, GOV.UK
- Carer Support Payment, mygov.scot
- Carer's Allowance, nidirect
This is guidance, not regulated financial advice. Check figures against the linked official source before you act. Written with AI assistance and checked against primary sources. How Kitty works. For free, impartial help, try MoneyHelper or Citizens Advice.