Need cash before payday due to a surprise expense? A salary advance or Earned Wage Access (EWA) lets you access part of your wages early. But there may be a fee and often little protection if things go wrong.
What is a salary advance?
A salary advance usually lets you receive a portion of your future salary early from your employer.
But your employer might need to be signed up to a salary advance scheme and you’ll typically pay a fee to get it.
A salary advance can also be known as:
Employer Salary Advance Scheme (ESAS)
Flexible Pay
On-Demand Pay.
What is Earned Wage Access (EWA)?
Earned Wage Access (EWA) lets you access wages you’ve already earned before your regular payday.
To access EWA, you would usually need to sign up to an EWA provider but check with your employer first. The EWA provider will:
track your work hours
determine when you need money before payday, and
let you access a portion of the wages you've earned.
Have you missed a payment?
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Who can get a salary advance?
You can only get a salary advance if your employer has a scheme in place. Before deciding to get one, it’s important to:
check what type of scheme it is, either:
getting your future salary paid early, or
Earned Wage Access – and check the provider has signed up to the Earned Wage Access Code of PracticeOpens in a new window
check your company’s policy for restrictions and guidance
review the provider’s terms and conditions, and
understand how and when you’ll receive the money.
Is a salary advance a good idea?
Being in control of your finances is much better than relying on a salary advance. But if you really can’t wait until payday, a salary advance is a way to deal with:
an unexpected one-off cost, or
an emergency.
It’s important to remember, a salary advance is not about getting extra money. You’re just getting a small percentage of your salary earlier, so you’ll need to budget for the shortfall come pay-day.
A salary advance is generally not a good idea and could make your financial situation worse if you:
have problem debts
have gambling issues, or
are at risk of being financially abused.
Salary advance - pros
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It won’t affect your credit score.
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The money is automatically adjusted from your next payslip.
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Depending on your situation, it might be cheaper than taking out loans or using other credit like overdrafts.
Salary advance - cons
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You get less money on your payday, so you’ll need to budget any earned income you access until then.
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It’s not regulated, so you can’t complain to the Financial Ombudsman Service (FOS) if things go wrong.
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You’ll need to check the terms and conditions each time you use it, as providers may alter them.
How do salary advance schemes work?
If you decide a salary advance is the way to go:
follow the provider's registration instructions, and
apply for the amount you need.
If your application is approved, you’ll receive the money. On your usual payday, the salary advance provider will take back this amount plus a fee and you’ll get the rest.
If your application is declined, check if you’ve met your company’s guidelines.
Learn how to cut back on costs and see what extra help is available using our guide Living on a squeezed income
Do you pay tax on salary advance?
A salary advance doesn’t make any difference, you’ll continue to pay your usual taxes and national insurance on payday.
How to maximise your income
Even saving a small amount each month will help pay for something unexpected. Find out more about how to build up your fund in our guide How much to save for an emergency.
If you’re claiming certain benefits, the Help to Save scheme gives a bonus of 50% (half) on savings.
Some EWA providers offer extra features directly through their platforms like:
benefits calculators, and
options to help you build emergency savings fund.
If money is tight and you’re not sure you can save, our guides below have tips on things you can try to free up some money:
see you can save by switching your household bills
check you’re getting all the benefits you’re entitled to
use our Budget Planner to see if there are any savings you could make
find organisations that offer urgent practical support in our guide Where can I get emergency help with money and food?.
How does a salary advance affect my Universal Credit payments?
Accessing part of your earned income before the regular payday won't affect your Universal Credit payments.
Whatever you make during a pay period is what Universal Credit looks at. It doesn't matter if you get some of your earnings early.
Even if your income fluctuates due to different shifts, it's the total for each assessment period that counts, regardless of when you receive the money.