How we calculate benefits

To work out your Housing Benefit and Council Tax reduction we consider your situation and then compare your income and capital with a figure called an ‘applicable amount’. The applicable amount is set by the government; it depends on your circumstances and reflects your basic needs.

Applicable amount

The applicable amount changes:
  • according to your age and your partner’s age
  • if you have a disability
  • if your partner or children have a disability
  • if your children qualify for child benefit  and this is paid to you or your partner

Income and capital

Your income and capital includes:
  • your income and that of your partner, if you have one
  • savings and investments
  • the income of anyone else living with you who is over 18 (non dependants)

There is a capital limit for Housing Benefit of £16,000. Claimants with more money than this amount are ineligible for Housing Benefit or Council Tax Reduction unless they are in receipt of Pension Credit Guaranteed Credit.

Household situation and eligible rent

We also consider your household situation, if you have a partner or children or have anyone else living with you. Then we take into account your ‘eligible’ rent and Council Tax payments.

If you are renting from a private landlord your eligible rent may be set by the Local Housing Allowance (LHA). Otherwise your eligible rent is found by taking your full housing rent and deducting anything which is ‘ineligible’. If your rent also covers any of the following these are ineligible:

  • water rates
  • fuel
  • hot water
  • heating or lighting
  • meals
  • laundry
  • TV, phone or internet