With a dramatic rise in the cost of living, many people are now poring over their finances in an effort to work out how they can make ends meet.

Help is at hand for some, however, if they claim a PIP, their financial support could amount to £2,000 — a lifeline for those really struggling with the cost-of-living squeeze. 

But what exactly is PIP, who can make a claim, and if you’re one of the nearly 3 million people already receiving PIP, can you expect a PIP cost-of-living boost?  

What is PIP? 

PIP is a lifeline for millions who are living with long-term physical or mental health conditions or disabilities.

It provides wide-ranging financial support for help with everyday tasks at home to help with getting out and about or even managing your finances. If you need a helping hand, it’s worth finding out if you are eligible for PIP.  

Previously known as the Disability Living Allowance (DLA), you are still eligible to claim PIP if you’re in work, have savings or are on most benefits (including Employment and Support Allowance). 

If you already receive PIP, the good news is that you could be due a cost-of-living payment, and we’ll provide more information on that further on in this article.   

How does PIP work? 

There are two parts to PIP.  If you need help with daily life — for example making meals, washing, managing your finances or even talking to other professionals such as your bank or health worker — then you can claim what’s known as a daily living component. 

And if you need help moving around — whether locally or further afield — then you can claim for the mobility component.

It’s important to note that this component isn’t just for people with physical health problems or disabilities — people with mental health conditions can apply for this component too.  

How much is the PIP payment? 

How much you’ll receive depends on how much of a challenge you find each of the two components outlined above (daily living and mobility), with each component paid at a standard and enhanced rate. 

The standard weekly payment for daily living is £61.85, and the enhanced payment is £92.40. For people claiming the mobility payment, the standard weekly payment is £24.45 and the enhanced payment is £64.50.  

To decide whether you should receive the standard or enhanced rate, the DWP conducts a PIP test, with your final score determining how much money you should get.

The DWP uses the information provided to them in your PIP application to work out your score, so it’s really important that these forms are filled out as fully and accurately as possible.  

Who can apply for PIP? 

To apply for PIP, you need to be below State Pension age and over 16.

As mentioned above, you need to have been living with a physical or mental health condition or disability that has impacted your life for at least three months, and which is expected to impact your life for at least a further nine months.   

It’s worth noting that if you — or a close family member — are in the armed forces, you’re not required to be resident in England, Wales or Scotland at the time of your PIP claim.  

How do I claim PIP? 

To begin your claim, contact the DWP on their PIP new claims phone line. 

All the information you need to get in touch can be found on their Personal Independence Payment web page. You’ll need to complete their PIP1 form, which you can do over the phone.  

When you call, make sure you have the following information to hand: 

• Your contact details — e.g. address, phone number, and email address if you have one 

• Your date of birth 

• Your bank details 

• Your National Insurance number  

• Contact details for your doctor or health worker 

• Dates and addresses for any care homes or hospitals you’ve been admitted to 

• If you’ve spent more than four weeks abroad, details of the countries you visited and for how long  

Once the DWP has received your application, you should receive a form with questions about your condition.

The information you provide will help the DWP decide not only whether your claim is successful, but also whether you will be entitled to receive the standard or enhanced rate of financial support.

It’s vital, therefore, to take your time and provide as much information as you can.  

In some cases, the DWP will want to know more about your situation, in which case you may be asked to undergo an assessment.  

You can make a postal application to the DWP, but your claim will take longer to process than if you claim online.  

How long will my PIP claim take? 

If the DWP decides you’re eligible for PIP, the money should arrive within six months of when you first got in touch — and this payment will cover the period after you first made your claim — be aware, however, that PIP payments won’t be backdated beyond the start of your claim. 

If you have a terminal illness, then your application will be fast-tracked, and your PIP payment should be issued automatically.  

If you're claim is rejected, you can learn more about the mandatory reconsideration process here.

Cost-of-living payment - what other benefits could you be entitled to?

You could also be entitled to a cost-of-living boost of up to £1,200 to help with your energy bills.

If you are on any of the following benefits, you could be eligible for a top-up (also called a premium).  

• Housing Benefit 

• Jobseekers Allowance 

• Income Support 

• Working Tax Credit 

• Employment and Support Allowance (only if you get the PIP daily living component) 

• Pension Credit (only if you get the PIP daily living component) 

In order to apply for this extra help, you’ll need your PIP award letter (also referred to as a PIP award notice).

Even if you get the enhanced rate of pay, you’ll still be entitled to this additional support.  

Don’t worry if you’re not in receipt of any of these benefits, because if you’ve been receiving PIP by 25 May 2022 — or have applied for PIP by May 2022 — then you should receive a £150 cost-of-living payment from the DWP.  

The cost-of-living crisis is a major challenge for all of us, and especially for people on lower incomes.

But with the right help and the right financial advice, you could be in receipt of all the benefits to which you’re entitled.   

To find out more about the kind of financial help that’s right for you, speak to an independent financial adviser.