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‘Can I get help with my rent?’
> 'I want to know how the Housing Benefit calculation works'

OK, so now we know what the eligible rent is (that's if you've read the page about renting in the private or social sectors...)

If you get a means-tested benefit…

If you are receiving a means-tested benefit (like Income Support, income based Jobseeker's Allowance, etc) and no-one lives with you apart from your partner, if you have one, and your children, if you have any, that’s it! The amount of Housing Benefit you get is equal to your eligible rent.

If you get a means-tested benefit but other adults do live with you, things get more complicated. Your eligible rent may be reduced by something called a ‘non-dependent deduction’, the size of which depends on the other person’s income. If you think this may apply you should seek further advice.

If you don’t get a means-tested benefit…


icon-warning1.jpgIf you have adults other than your partner living with you, your eligible rent may be reduced by something called a ‘non-dependent deduction’, the size of which depends on the other person’s income. If you think this may apply you should seek further advice
 

 If no-one else lives with you apart your partner, if you have one, and your children, you just need two more ingredients before you can do the calculation:

Applicable Amount

Your applicable amount is the amount the government thinks you need to live on: it’s got nothing to do with what you really need to live on.

Your applicable amount is built up of various bits:

There is a table of the whole lot here.
 

Income

This is pretty much what it says: any money you have coming in. However there are some complications: the main ones are as follows:

Now, the calculation…

If your income is less than your applicable amount, it’s simple: your entitled to an amount of Housing Benefit equal to your eligible rent

If your income is more than your applicable amount:

I think we need an example here…

icon-example1.jpgAhmed (40) and Aisha (33) live in a privately rented house with their three children. No-one in the family is disabled or caring for anyone who’s disabled, and no-one else lives with them. Their actual rent is £250 per week, but their eligible rent is just £200 per week.
  • The money they have coming in is as follows:
    • £240.00 earnings
    • £ 48.10 Child Benefit
    • £210.00 Working Tax Credit and Child Tax Credit 
  • Applicable Amount:
    • £114.85 Personal allowance for couple, plus
    • £200.70 Personal allowance for three children (66.90 x 3), plus
    • £ 17.45 Family premium, equals
    • £333.00 Applicable Amount
  • Income
    • We can ignore £10 per week from the earnings because they are a couple, and can ignore a further £17.10 because Ahmed works more than 16 hours per week, so the earnings are reduced to £212.90
    • Child Benefit doesn’t count as income for these purposes, so we can ignore it
    • The £210 tax credits has to get taken into account in full
    • The total income for these purposes is therefore £422.90 (£212.90 + £210.00)
  • The calculation
    • First, work out how much the income exceeds the applicable amount (£422.90 - £333.00): this equals £89.90 (this is called the 'difference figure') 
    • Next, multiple the difference figure x 65%: this equals £58.44 (this is called the 'taper')
    • Finally, reduce the eligible rent by the taper to arrive at the actual housing benefit: £200 - 58.44 = £141.57.
  • So Ahmed and Aisha get £141.57 Housing Benefit per week. They have to make this up with £108.44 (£50 (the difference between the actual rent and the eligible rent) plus £58.44) themselves to make sure that all the rent is paid.

(Another way of looking this is that the taper is the bit of the eligible rent that you have to pay: in this case Ahmed and Aisha have to pay £58.44, as well as the £50 shortfall between the actual rent and the eligible rent.)



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