Thousands of people receiving Carer's Allowance could see their debts reduced, cancelled, or refunded as part of a major Department for Work and Pensions (DWP) reassessment. Unpaid carers across the UK are being urged to be aware of this significant review, which follows years of controversial overpayment rules.
Background of the Review
The DWP is reassessing around 200,000 cases involving Carer's Allowance overpayments, many dating back to 2015. This review follows an independent investigation that found the system had been confusing and, in some cases, unfair to carers. Carer's Allowance is designed to support people who provide at least 35 hours of care per week, but strict earnings limits mean claimants can lose entitlement if they earn even slightly above a set threshold.
Findings of the Independent Review
The review discovered that some carers were left with large debts after exceeding the weekly earnings limit by only a few pounds or even pence. Because of how the rules were applied, exceeding the limit could result in the loss of an entire week's payment, with overpayments building up over time before being identified. In some cases, carers were later asked to repay thousands of pounds, despite believing they had followed the rules correctly.
The independent review concluded that guidance around earnings and reporting requirements was not always clear, and the system did not consistently apply flexibility, such as averaging income over a period of time. The DWP has accepted the majority of recommendations made in the report, and the reassessment is now underway.
What Carers Need to Know
- Around 200,000 cases are being reviewed.
- Some people could have debts reduced, cancelled, or refunded.
- The review focuses on earnings-related overpayments.
- Most carers do not need to take any action yet.
- The DWP will contact affected individuals directly.
For those affected, outcomes could include having debts written off, reduced, or refunded if money has already been repaid. Most carers do not need to contact the DWP at this stage; anyone whose case is being reviewed will be contacted directly.
Campaigners' Response
The issue has previously been described as a 'scandal' by campaigners, who argued unpaid carers—many already under financial pressure—were treated unfairly. The UK Government has said the changes are intended to ensure carers are treated more fairly and to prevent similar issues from happening again.
Next Steps for Carers
Anyone currently receiving Carer's Allowance should continue to report changes in earnings as normal to the DWP, as the underlying rules around eligibility remain in place. The reassessment exercise covers cases from April 2015 to September 2025 in which earnings-related Carer's Allowance overpayments arose due to guidance that did not accurately reflect the statutory position on averaging irregularly fluctuating earnings.
Free advice and support for anyone whose Carer's Allowance case is or might be involved in the reassessment exercise will be available from the DWP on 0800 731 0297 or from trusted partner organisations such as Carers UK and Carers Trust. The UK Government response to the Sayce Review was published in November 2025. Further information for affected carers is available on GOV.UK.
