If you're a Universal Credit recipient, be aware that the Department for Work and Pensions (DWP) may decrease or cease your payments if your savings surpass a specific limit.

More than seven million Brits are currently claiming Universal Credit. If your cash, savings and investments amount to more than £6,000, your benefit will be reduced by £4.35 for every £250 you have between £6,000 and £16,000.

Should your savings exceed the threshold but not reach £250, an extra £4.35 is deducted from your Universal Credit. For example, if you have £6,300 in savings, the initial £6,000 wouldn't be subject to any deductions, but the remaining £300 would result in your payments being reduced by £8.70.

This equates to £4.35 deducted for the first £250, then another £4.35 for the residual £50 that makes up the £300. These figures apply whether you're a single claimant or claiming as part of a couple, reports the Mirror.

Generally, you're not eligible for Universal Credit if your savings exceed £16,000. However, if you're a Tax Credits claimant who's been asked to switch to Universal Credit, you might still qualify for Universal Credit for up to a year even if your savings are above £16,000.

Universal Credit comprises a standard allowance, which is the basic sum you receive before any additional elements - such as if you have children or are unable to work due to illness - or any deductions are taken into account. For those in employment, the Universal Credit system implements a taper rate that reduces your maximum entitlement as your income increases.

Currently, the taper rate is set at 55%, which means for every £1 you earn, 55p is deducted from your maximum Universal Credit payment. Some claimants are entitled to a "work allowance", a predetermined sum that you're allowed to earn before your Universal Credit starts to diminish.

The "work allowance" is pegged at £411 a month for individuals receiving help with housing costs, and £684 a month for those who aren't.

Here are the values of the different components of Universal Credit:

Here is how much the different elements of Universal Credit are worth:

Standard allowance

• Single under 25: £316.98 a month
• Single 25 or over: £400.14 a month
• Joint claimants both under 25: £497.55 a month
• Joint claimants, one or both 25 or over: £628.10 a month

Child element

• First child born before April 6, 2017: £339 a month
• First child born on or after April 6, 2017 or second child and subsequent child: £292.81 a month
• Disabled child element lower rate: £158.76 a month
• Disabled child higher rate: £495.87 a month

Limited capability for work

• Limited capability for work: £158.76 a month
• Limited capability for work or work-related activity: £423.27 a month

Carer element

• £201.68 a month

Work allowance

• Higher work allowance (no housing amount): £684 a month
• Lower work allowance (with housing amount): £411 a month

Childcare costs element

• Maximum for one child: £1,031.88 a month
• Maximum for two or more children: £1,768.94 a month