If you have spent or given away some capital in order to get, or increase the amount of, universal credit, you will be treated as still having that capital. This is called ‘notional’ capital. In some cases, the amount of notional capital along with any actual capital will exclude you from universal credit. Or, you may still be entitled to universal credit, but at a reduced rate because your notional capital puts you into to a higher assumed income block than your actual capital warrants (see 18 above ).

You will not be treated as having notional capital if you used it for reducing or paying off a debt, or for buying goods or services if the expenditure was reasonable.

If you are treated as having notional capital, you won’t be excluded from universal credit (or placed in a higher assumed income block) permanently. Your notional capital will be reduced over time. How this is done depends on the level of your notional capital.

If your notional capital exceeds £16,000 –