The £326 payment will be paid to eight million households on means-tested benefits across England, Wales, Scotland and Northern Ireland between today and the end of July.

It’s the first instalment of the £650 cost of living payment from the government to help people with the soaring cost of fuel. The second instalment (£324) will be paid in the autumn.

To get the first payment from today, households must have been in receipt of any of the following benefits, or have begun a claim which was later successful, during 26 April and 25 May: Universal Credit, Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit or Pension Credit.

The Department for Work and Pensions (DWP) confirmed this payment will be tax-free, will not count towards the benefit cap, and will not have any impact on existing benefit awards.

Households who are eligible because they receive tax credits and no other eligible benefits will receive their first instalment from HMRC in the autumn, and the second instalment in the winter.

For those in receipt of the new style Employment and Support Allowance, contributory Employment and Support Allowance, or new style Jobseeker’s Allowance won’t be eligible.

Chancellor of the Exchequer, Nadhim Zahawi, said: “It’s great that millions of the families who are most in need are starting to receive their cost of living payments, which I know will be a massive help for people who are struggling.

“Alongside tax cuts, changes to Universal Credit and the Household Support Fund, these payments are a vital part of our £37bn support package to help people deal with rising prices.”

In May the government announced all households would receive a £400 discount on energy bills in October, while vulnerable and low-income households would receive at least £1,200 to help with the rising cost of living.

This is made up from the direct payment of £650 for over eight million households on benefits, a separate £300 payment for pensioners, and a £150 payment for disabled people, as well as the £400 energy discount and the previously announced £150 council tax rebate.