New Style ESA vs Income-Related ESA - What Changed and Which Still Exists

Updated June 2026

If you are trying to claim Employment and Support Allowance, the first thing to understand is that there were two very different versions, and only one of them is still open to new claims. New Style ESA (also called contribution-based ESA) is based on your National Insurance record and is not means-tested. Income-related ESA was the old means-tested version, and it is now closed to new claims and being replaced by Universal Credit. This guide explains exactly what the difference is, which one still exists, how means-testing works, and what the move to Universal Credit means for you.

The short answer

New Style ESA is the only type of ESA you can make a fresh claim for today. It depends on whether you have paid or been credited with enough National Insurance contributions, and it ignores your savings and your partner's income. Income-related ESA has been closed to new claims for years, and the remaining people on it are being moved across to Universal Credit through a process called managed migration. If you need means-tested help with living costs and you cannot work because of illness or disability, the modern equivalent is Universal Credit with the health element, not income-related ESA.

What was income-related ESA?

Income-related ESA was the means-tested strand of the old ESA system. It was designed for people who had limited capability for work but who either had not paid enough National Insurance to qualify for the contribution-based version, or whose contribution-based award had run out or was too low. Because it was means-tested, the amount you received depended on your household circumstances: your savings and capital, any partner's income, your housing costs, and whether you had any premiums for things like severe disability.

The defining features of income-related ESA were:

• It was means-tested, so capital above a lower threshold reduced your award and capital above an upper threshold ruled you out entirely.
• A partner's earnings and other household income were taken into account.
• It could include extra premiums and help with mortgage interest in some cases.
• It did not depend on your National Insurance record, so people with little or no work history could still qualify.

This is the version that is being phased out. It sits among the old "legacy" means-tested benefits that Universal Credit was built to replace.

What is New Style ESA?

New Style ESA is contribution-based. To qualify you generally need to have paid enough Class 1 or Class 2 National Insurance contributions over the relevant tax years, or have been credited with them. Because it is a contributory benefit, it works completely differently from income-related ESA:

• It is not means-tested. Your savings and capital do not matter, and a partner's earnings do not reduce it.
• It depends on your National Insurance record rather than your household income.
• It still requires you to show limited capability for work through the Work Capability Assessment.
• A personal or occupational pension above a set threshold can reduce the amount, and so can earnings above the permitted work limit.
• While you receive it you usually get National Insurance credits, which protect your State Pension record. These credits matter most as you approach ESA and State Pension age, the point at which ESA itself normally comes to an end.

If you have been employed and paying National Insurance in recent tax years and you become too unwell to work, New Style ESA is very often the right benefit to claim. For a fuller breakdown of the contribution conditions, see our guide to contribution-based ESA eligibility.

How the two versions are means-tested (and not)

The single biggest practical difference is means-testing. Income-related ESA looked at your whole household financial picture. New Style ESA does not. This has real consequences:

• If you have savings, New Style ESA pays the same regardless. The capital limits that applied to income-related ESA simply do not apply. Our guide on ESA and the savings and capital limit explains how this works and when capital still matters for Universal Credit.
• If you live with a working partner, New Style ESA is unaffected by their wages, whereas income-related ESA would have been reduced or stopped.
• Because New Style ESA is paid to the individual on the strength of their own contributions, it is sometimes the only benefit a household can get if the partner earns too much for means-tested help.

Universal Credit, which now provides the means-tested support that income-related ESA used to give, is means-tested in a similar way to the old benefit: it takes account of household income, capital, and circumstances. So the means test did not disappear; it moved into Universal Credit.

Why income-related ESA is moving to Universal Credit

Universal Credit was introduced to merge six older means-tested benefits, including income-related ESA, into a single payment. For several years now, no one has been able to make a brand new claim for income-related ESA. The remaining caseload is being moved across through managed migration.

Managed migration works like this. The DWP sends you a migration notice letter telling you that your old benefit is ending and that you must claim Universal Credit by a stated deadline, usually about three months away. If you claim by the deadline, you may be entitled to transitional protection, a top-up that aims to ensure your Universal Credit is not lower than your old benefits at the point of change. If you ignore the notice, your income-related ESA will stop and you could lose money.

The most important rule is simple: do not ignore a migration notice. You must actively claim Universal Credit; it does not happen automatically. If you are unsure, get a benefits check from Citizens Advice or a welfare rights service before you claim, because the timing affects whether you keep transitional protection.

How New Style ESA and Universal Credit fit together

A common source of confusion is whether you can have both. You can. New Style ESA and Universal Credit are designed to work alongside each other:

• New Style ESA gives you a non-means-tested income based on your contributions, plus National Insurance credits.
• Universal Credit can top this up with means-tested help for rent, children, and other living costs.
• If you receive both, your New Style ESA counts as income for Universal Credit, so the Universal Credit amount is reduced pound for pound by the ESA. You are not paid the same money twice.

Even when the ESA is fully offset against Universal Credit, claiming it can still be worthwhile because of the National Insurance credits and because it secures your contribution record. Whether you go through the WCA under ESA or under Universal Credit, the test of limited capability for work is the same.

The groups and rates: where the money differs

Both New Style ESA and the old income-related ESA use the same Work Capability Assessment to sort claimants into groups. After the assessment phase, which pays a lower rate for roughly the first 13 weeks, you are placed in one of two groups:

• The Support Group, for people with the most severe limitations, which pays the higher rate and carries no requirement to do work-related activity. Our guide explains how to qualify for the Support Group.
• The Work-Related Activity Group (WRAG), which pays a lower rate and expects you to take part in work-focused activity. See the WRAG explained for what this involves.

For New Style (contribution-based) ESA there is an important extra rule: if you are in the WRAG, the contribution-based payment is normally time-limited to around 12 months. If you are in the Support Group, there is no time limit. The Support Group also pays more, which is why the group you are placed in matters so much. For the current weekly figures, always check the official rates because they are uprated each year - we keep our own summary at ESA rates 2026 and you can confirm against GOV.UK.

The WCA itself is changing

It is worth being aware that the Work Capability Assessment is under reform. The government has set out plans to change how limited capability for work and work-related activity are assessed in the coming years, which will affect both ESA and the Universal Credit health element. If you have seen headlines about the test being scrapped, our guide on whether the WCA is being abolished sets out what has actually been announced. The contributory versus means-tested distinction between New Style ESA and Universal Credit is not affected by this, but the assessment that decides your group could be. We track developments in our ESA changes 2026 guide, and you should always confirm the current position on GOV.UK before you make decisions.

Which one should you claim?

Putting it all together:

• If you have a recent National Insurance record from employment, claim New Style ESA. It is not means-tested, protects your contribution record, and is open to new claims.
• If you need means-tested help with living costs, claim Universal Credit with the health element. This is the modern replacement for income-related ESA. If you are not sure ESA or Universal Credit - which am I on, our guide helps you tell from your award letter and payment.
• If both apply, you can claim both, and the ESA will count as income for the Universal Credit calculation.
• If you are already on income-related ESA and receive a migration notice, claim Universal Credit by the deadline to protect your income.

For a step-by-step on starting a claim, see how to apply for ESA, and if you are weighing ESA against other support, our ESA vs PIP comparison explains how the two can be claimed together.

Official sources

This guide reflects the official ESA and Universal Credit rules. For the source material, see:

• GOV.UK - Employment and Support Allowance
• GOV.UK - Universal Credit and managed migration
• The Employment and Support Allowance Regulations 2013
• Citizens Advice - Employment and Support Allowance

Guidance only, not legal advice. Rules can change - always check GOV.UK for the latest.

Frequently Asked Questions

Related Guides

• Contribution-based ESA eligibility
• ESA and the savings and capital limit
• How to apply for ESA
• ESA vs PIP
• ESA changes 2026