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Benefits - Local Housing Allowance
Benefits - Local Housing Allowance
The Department for Work and Pensions (DWP) has changed the rules for working out Housing Benefit for new claims made after 7 April 2008. The new scheme is called Local Housing Allowance (LHA).
What is Local Housing Allowance?
Local Housing Allowance (LHA) is a new way of working out and paying Housing Benefit for people who rent from a private landlord. With LHA, benefit will be based on the number of bedrooms you need and not how much the rent is.
There is no change to the Housing Benefit entitlement rules which will still be based on a person’s income, savings and proof of rent, etc.
Who will be affected by the Local Housing Allowance?
- Anyone who lives in private rented accommodation and makes a new claim for Housing Benefit on or after 7 April 2008
- Existing claimants who change address and rent their property from a private landlord on or after 7 April 2008
- Existing claimants in privately rented accommodation who have a break in their claim after 7 April 2008
Who will not be affected by Local Housing Allowance?
You will not be affected if:
- You rent your property from your local council
- You rent your property from a housing association
- You have a tenancy that started before 15th January 1989
- Your rent has been registered with the rent officer as a 'fair rent'
- You live in a caravan, mobile home or houseboat
- Your accommodation is provided by a county council, housing association, registered charity or voluntary organisation
and you are provided with care, support or supervision - You live in board and lodging accommodation and the rent officer decides that a substantial part of the rent is for board and attendance.
If you fall into one of the above groups, your Housing Benefit will continue to be calculated under the existing rules.
How is Housing Benefit calculated under Local Housing Allowance?
The amount of benefit you can get under LHA rules is based on:
- Who lives with you and the number of bedrooms your family needs
- The area you live in
- The amount of money you have coming in
- What capital / savings you have
The LHA rates may be different for each area and will be set by an independent rent officer, based on local rents. We will publish the LHA rates every month. These rates will determine the maximum amount of benefit you may get.
What's different about Local Housing Allowance?
Under the current rules, most private tenants claiming Housing Benefit have their rent examined by the rent officer who decides what level of rent is used in each case. This can be the same as the rent a person is charged by their landlord or sometimes it can be set at a level less than the landlord charges.
With LHA you will know before you find somewhere to live, how much help with your rent you might get. By knowing how much you might get, it will be easier for you to decide what type of property you can afford.
If your rent is up to £15 lower than the LHA rate that applies to you, any benefit you might get will still be based on this rate. For example, if your rent is £90 per week and the LHA is £100, then the maximum amount of benefit we could pay you would be £100. This will not affect any other social security benefits you get.
How many bedrooms do I need?
The number of people who live with you is used to work out how many bedrooms you are entitled to. We do not count other rooms such as living room, kitchen or bathroom. You are allowed one bedroom for:
- Each adult couple
- Any other person aged 16 or over
- Any two children of the same sex aged under 16
- Any two children aged under 10, regardless of their sex
- Any other child
The number of bedrooms you are assessed as needing is then used to work out which LHA rate usually applies to you. For example
- A couple (or lone parent) with one child would be assessed as needing two bedrooms.
- A couple (or lone parent) with two sons aged 6 and 11 would also be assessed as needing two bedrooms.
- However, a couple (or lone parent) with a son aged 11 and a daughter aged 6 would be assessed as needing three bedrooms.
In some cases, there are extra rules - these are looked at below. Alternatively, use the Local Housing Allowance Bedroom Calculator (follow the link under Also See below) to calculate how many rooms you are entitled to.
If you are under 25:
- are aged under 25
- are single
- live alone
- are not severely disabled
- are not a care leaver aged under 22
Your benefit will be based on the LHA shared room rate regardless of the size of accommodation that you occupy. We will publish the LHA rates on this website once the figures are available.
If you are a care leaver aged under 22:
- are a care leaver aged under 22
- or live with a care leaver aged under 22 who is your partner
- and you have no dependent children living with you
Your benefit will be based on the one bedroom LHA rate. We will publish the LHA rates on this website once the figures are available.
By 'care leaver' we mean someone who was in council care after the age of 15.
Once a care leaver reaches the age of 22, the shared room LHA rate applies.
If you are part of a couple, or are single over 25, with no dependent children
- are part of a couple
- or are single aged 25 or over
- and you have no dependent children living with you
Your benefit will be based on the one bedroom LHA rate, provided you actually live in self-contained accommodation or you live in shared accommodation, but have sole use of two (or more) rooms.
However, if you live in accommodation where you share facilities with other people, and have sole use of one room only, your benefit will be based on the shared room LHA rate. We will publish the LHA rates on this website once the figures are available.
If you are severely disabled:
- are severely disabled
- or live with a severely disabled partner
- and have no dependent children
Your benefit will be based on the one bedroom LHA rate regardless of the size of accommodation that you occupy. By severely disabled we mean that you have the Severe Disability Premium included in your benefit assessment.
If you have non-dependants:
If you have any non-dependants living with you (for example grown-up children, parents or other relatives or friends) your benefit may be reduced depending on your and your non-dependant’s circumstances.
This is because they are expected to contribute towards your rent.
If you are a joint tenant:
If you are a joint tenant (with someone other than your partner) your benefit will be based on the LHA rate solely applicable to your family, plus your non-dependants, sub-tenants or boarders.
How will benefit be paid?
With LHA, benefit will normally be paid direct to you and it will be your responsibility to pay your rent to your landlord. You cannot simply choose to have your benefit paid direct to your landlord.
LHA will normally be paid direct into a bank account. This means that you will need to open a bank account if you do not have one already. You can then arrange for your bank or building society to pay your rent to your landlord automatically. One way of doing this is called a standing order. If you need to find out more information about opening a bank account, please:
- visit your local Citizens Advice Bureau (see Related External Links below)
- visit 'Money Made Clear' on the FSA website (see Related External Links below)
- Call Housing Benefit Customer Services on 020 8547 5198.
Safeguards
The government understands that some tenants may struggle with the responsibility of paying their rent and has provided guidance on when direct payment to the landlord may be appropriate. This means that we can still pay benefit direct to your landlord if we consider that you are likely to have difficulty managing your financial affairs.
We have developed a ‘Direct Payment’ Policy that will serve as a safeguard to minimise the risk of tenants losing their homes due to eviction for rent arrears. The Direct Payment Policy will also reduce any fears that landlords may have regarding potentially vulnerable tenants and those who are unlikely to pay.
When may the Council make payments to the landlord?
Although you cannot choose to have your benefit paid to your landlord, the Council can, in the following circumstances, decide to pay benefit to your landlord:
- If you are eight weeks or more in arrears with your rent
- If you are likely to have difficulty in managing your financial affairs
- If you are unlikely to pay your rent
We will include more information regarding this closer to April 2008.
Who can ask for the payments to be made to the landlord?
The following people may tell the Council that you are having difficulty paying your rent:
- You can approach the Council yourself
- Your friends or family
- A person acting on your behalf
- Your landlord
The Council may also identify tenants who may have difficulty managing their money from our own face to face contact, for example, when carrying out home visits.
We will include more information regarding this closer to April 2008.
How do I find out more?
If you have any questions about LHA now, please contact Housing Benefit Customer Services on 020 8547 5198.