DEDUCTIONS to Universal Credit are having an even larger impact thanks to the cost-of-living crisis.

Inflation is set to soar to 11 per cent, and the energy price cap to rise to around £3,000 in the autumn too.

Research from StepChange suggests the impact of rising costs make deductions for Government debts a major risk for households on low incomes.

Universal Credit was designed to replace six previous benefits – a move to help encourage people to find work.

But the Department of Work and Pensions can automatically deduct money from your allowance to pay off your debts owed to the government.

StepChange clients on Universal Credit are set to face an average monthly budget deficit of £77 come October even with Government support.

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In the meantime, here's FIVE of the biggest reasons why your Universal Credit payments could be cut.

Benefit overpayments

Some households are suffering after being initially overpaid by Universal Credit.

One mum was hit with the sanction even though the error was not her fault.

An admin error meant that she'd been paid £738 more than she should have been.

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But she was then hit with a £50 penalty, even though the overpayment was not her fault.

And other Brits around the country are facing a similar predicament by having to repay the debt at the worst possible time.

Due to deductions, one woman said she was struggling to live off £143 a week with deductions scaling back her allowance.

Advance loans

Those struggling during the wait for Universal Credit payment may have taken out an advance loan.

But while it's interest free, there is a significant gap between applying for the scheme and receiving money.

It's this waiting period that plunges vulnerable Brits further into debt.

It can take up to five weeks before you are enrolled on the Universal Credit system, and in the meantime any existing benefits you receive will stop altogether too.

The loan means the repayments will be automatically deducted from your future Universal Credit pay out.

Budgeting loans

Struggling Brits on Universal Credit can get a budgeting loan to cover unexpected costs in the new year.

But while claimants can apply for the money worth up to £812 – you will have to plan for paying it back over the coming 12 months.

You can borrow from as little as £100 and up to £812 if you're a household with kids, but you should only apply to borrow what you need.

While this can help you cover larger costs in the short term if you don't have savings to fall back on, you will still be expected to pay the money back in the long term.

The Department for Work and Pensions (DWP) deduct an amount from your Universal Credit payment every month, starting with your first one.

Not applying for work

Another reason why your Universal Credit payments could be stopped or cut is that you're not applying for work.

This is because under the commitments you agree to apply for jobs to get you back into employment.

Universal Credit claimants are expected to accept jobs they have been offered it as long as it's within reason.

If your Jobcentre work coach doesn't feel you're doing enough to get back into work you can be sanctioned.

Quitting your job

Quitting your job without a good reason could see you sanctioned too.

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There's no set definition of what a good reason is, but it might include unaffordable childcare costs.

You might have your benefit payments reduced though, if you made the decision to leave what work your are in.

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