Those claiming Personal Independent Payments and Disability Allowances will lose out on £750 from January 3, 2025.
It comes as the Department for Work and Pensions prepares to scrap its New Vehicle Payments, one-off sums of £750 designed to help people on benefits get new cars.
The expiry date for the perk, which enables those eligible to get over £700 towards a new set of wheels through the Motability Scheme, was originally set at December 31 – with the DWP getting in the Christmas spirit by extending it into the New Year.
The extension will allow those affected to nab the available payment before it’s too late and as car dealerships reopen after Christmas.
It was introduced in February 2022 and increased from a lump sum £250 to £750 in March 2023, in line with the increasing price of new vehicles.
A spokesperson for the scheme operator said: “[The extension] is to give you a final chance to order your first car if your dealer is closed over the festive period.
“Already have a new vehicle on the scheme? This end date does not affect you. If you’ve not already had the New Vehicle Payment, you’ll get it with your next car, even if that’s after January 3, 2025.”
However, the payment, which goes towards an advance payment on a vehicle – and can only be used once by those eligible for it – will not be available to anyone who orders their vehicle from January 4.
The payment can only be used towards the cost of the vehicle’s advance payment – not for optional extras or adaptions.
Through the flexible scheme, money is either sent directly to the car dealership, or, if vehicles are ordered without advance payments, directly to the individual within a few weeks of the vehicle being acquired.
It can be sent by bank transfer if payment details have been saved in the Motability Scheme server, or by a cheque in the post.
A payment of £100 is also available towards the purchase of scooters and powered wheelchairs under the New Product Payment banner.
People claiming PIP and Disability Allowance benefits cannot get both New Product and New Vehicle payments, however, and must choose between the two.
This scheme will also come to an end on January 3, so those interested are advised to order before that date to ensure they qualify.
