RR2 - A guide to Housing Benefit and Council Tax Benefit
What you can claim for
Claiming Housing Benefit
You may claim help from Housing Benefit (HB) toward the rent you pay for where you live. Your local council will decide if help can be given with the payments you make and if they can be met in full. This is explained in this section. The council also has to take into account what other people who live with you, but not as part of your family, should contribute to your rent. This is explained in further detail.
Eligible rent
The eligible rent is simply the amount you pay just to occupy your home – so it does not include charges for heating, lighting, meals and water costs and some service charges (these are listed). Any parts of your rent that you do not have to pay to continue living in your home will not be included as part of your eligible rent. [HB Reg 10]
The eligible rent is the amount that appears in the calculation of HB and is called the Maximum Housing Benefit. The eligible rent is worked out in different ways depending on the type of tenancy you have.
The eligible rent for all local authority tenants is based on the actual rent you pay, which is the same for most tenants of registered housing associations and other tenancies where rents are kept below the local market rent. The eligible rent for nearly all other tenancies is decided by the maximum rent rules.
The rules for calculating maximum rent are explained.
Certain charges can be
included in the eligible rent and others can not. These are explained below:
Garages
You can claim HB for a garage only if it is a part of your property. If you choose to rent it separately you cannot get HB for the garage, unless you are making reasonable efforts to end your liability to pay rent for it. [HB Reg2(4)]
Water charges
Water charges cannot be included in HB.
Council Tax
Council Tax cannot be met by HB. If you are liable for the Council Tax and need help to pay it, you should claim Council Tax Benefit.
Service charges
Some service charges may be included as part of your eligible rent if: [HB Sch 1]
- you have to pay them to occupy your home
- and the council accepts that the service charges are not excessive
- and they are related to the provision of adequate accommodation.
Service charges you can claim for
Service charges that you have to pay to occupy your home will be counted as part of your eligible rent if they are related to
the provision of adequate accommodation.
Examples of service charges that may be included in your eligible rent are:
· children’s play areas
· cleaning and heating of communal areas. These are defined as areas (other
than rooms) of common access (including halls and passageways) and rooms of common use in sheltered accommodation
·
connection to a radio or television system (except satellite and cable relay systems) in specified circumstances
·
other services such as those provided by caretakers which relate to the provision of adequate accommodation.
This list is not exhaustive; other service charges may be included in your eligible rent.
Service charges you cannot claim for
Only service charges that you have to pay to occupy your home will be included in your eligible rent.
Examples of charges
that cannot be included in your eligible rent are charges for:
- meals or groceries
- personal laundry (but not a service charge for the use of laundry facilities)
- cleaning of rooms and windows (other than communal areas)
- transport
- leisure items like recreation facilities (but payments for children’s play areas are allowed)
- television rental and licence fee (but the cost of television and radio relay may be allowed).
Meals
Amounts you pay with your rent for meals are not allowed in your eligible rent. The council will deduct a fixed amount from your eligible rent for each person who gets:
- full board (at least three meals a day)
- or breakfast only
- or part board (that is, any other arrangements where meals are provided).
Half the fixed amounts are deducted for children aged under 16 getting full board and part board. See leaflet GL23 Social security benefit rates For the fixed deductions.
Furniture
Charges for the acquisition of furniture, or for the use of furniture that will eventually become your own, cannot be included in your eligible rent. Other charges for the use of furniture and household equipment that you are not buying will be included.
Medical and personal care
Any service charges for medical, nursing or personal care are not included in the eligible rent.
General counselling and support
Service charges for general counselling and support services are not usually eligible for HB.
Other service charges
Any other charges for services which are not connected with the provision of adequate accommodation are not met by HB (such as charges for your personal needs, even if these are essential for you to remain in your accommodation).
Fuel charges
HB cannot help with fuel charges for your home. If your rent includes an amount for fuel, it will not be met by HB. [HB Sch 1]
Supplying and using fuel
Different charges are not normally made for supplying and using fuel, so the council will not be expected to separate them. But if separate charges are Clearly being made then the council will only pay an amount for the supply of fuel but not for the use of fuel. For example, you may be charged for the maintenance of a central heating system (the supply of fuel) separately from the cost of the heating (the use of fuel). In this case your eligible rent would include the amount for maintenance of the system but exclude the heating bill.
Communal areas
Fuel charges – for example heating and lighting – for communal areas are included in your eligible rent. If you live in sheltered accommodation this can include fuel for rooms everybody in the building uses, but normally it only applies to areas like shared corridors used for access.
Rules about maximum rent
If you live in private rented accommodation the amount of your eligible rent will normally be decided by the rent officer. When deciding a reasonable rent he will take account of rent levels of accommodation in the area where you live which is of a suitable size for your household. This has been the case since the rules changed from 2nd January 1996.
Accommodation size
If your accommodation is considered larger than is necessary for your family and others living with you, then the rent officer may consider your accommodation to be too large.
A realistic assessment must take into account the size of your household. When deciding whether or not your accommodation is too large the rent officer has first to take into account your needs and those of:
- your partner
- and any dependent children living with you as members of your household
- and any relative of yours or your partner who is living with you
- and anybody else who lives in your household
The rent officer will make two determinations of a reasonable rent for a property of a suitable size for your household; firstly a property in the more immediate area of where you live called the claim related rent and secondly a property in a broader locality called the local reference rent. The lowest of these will be the maximum rent and will be used as the eligible rent for your claim for benefit.
Claim-related rent and local reference rent
If the rent you pay is higher than:
- the claim-related rent for your particular home
- or the local reference rent (the average rent for other similar dwellings in your area)
then the council must use the lowest as the maximum rent, rather than your full eligible rent.
In other words, HB is meant to help with rents at the general level of rents in your area, for the size of home that is appropriate for you and your family.
Claim-related rent
The Rent Officer looks at the rent for your particular home in order to see whether the rent is reasonable. If it is, the claim-related rent will be the actual rent you pay less any ineligible charges. However, if the rent is not reasonable, the Rent Officer will work out the following valuations:
- either the rent that your landlord should reasonably expect to obtain for your accommodation
- or (if the accommodation is larger than is appropriate for your needs) the rent that a landlord might reasonably expect to obtain for accommodation of an appropriate size for your household in your neighbourhood.
The claim-related rent will then be:
- the lowest of these
- or your actual rent if that is lower, less any ineligible charges,.
Local reference rent
The Rent Officer has rent details for similar homes in your area and uses them to work out the general level of rent in the locality of our home. This is the local reference rent.
The ‘locality’ (your area) will be determined by the Rent Officer, based on their expert knowledge of the housing market in that area. (‘Locality’ is a familiar concept to property valuers.)
The Rent Officer will set two figures to represent the range of rents. They will exclude any rents that are exceptionally high or low. For example, ‘luxury’ accommodation might be excluded at the high end, and tied or non-commercial property excluded at the low end. The local reference rent will be the middle of the range set by these two figures.
The local reference rent will not include any ineligible charges.
How the rules work
When your eligible rent is the same as, or less than, the local reference rent and the claim-related rent
Your maximum rent will be the same as your eligible rent.
When your eligible rent is less than the local reference rent, but more than (or the same as) the claim-related rent
| The maximum rent the council can consider will be your claim-related rent. For example (weekly figures): | |
|---|---|
| Local reference rent | £55 |
| Eligible rent | £50 |
| Claim-related rent | £45 |
| Maximum rent | £45 |
Even though the eligible rent is lower than the local reference rent, you cannot be paid the local reference rent.
When your eligible rent is less than (or the same as) the claim related rent, but more than the local reference rent
| The maximum rent will be the local reference rent. For example (weekly figures): | |
|---|---|
| Claim-related rent | £55 |
| Eligible rent | £50 |
| Local reference rent | £40 |
| Maximum rent | £40 |
When your eligible rent is more than both the claim-related rent and the local reference rent
| The maximum rent will be the local reference rent. For example (weekly figures): | |
|---|---|
| Eligible rent | £50 |
| Claim-related rent | £45 |
| Local reference rent | £35 |
| Maximum rent | £35 |
Exceptions to the rules
The rules do not affect you if:
- you rent your home from a local authority· you rent your home from a registered Social Landlord (unless your council considers the rent to be unreasonably high, or believes that your accommodation is larger than you need, in which case it will ask the Rent Officer to look into it)
- you started renting the home you now live in from a private landlord before 15 January 1989 (2 January 1989 in Scotland).
- you have been claiming HB continuously since before the maximum rent rules were introduced from 2nd January 1996
The rules can be deferred for 13 weeks if, when you moved into your home you could afford the rent. In this case, when you start claiming HB the maximum rent rules will not be applied for 13 weeks from your first day of entitlement to benefit. But if you claim HB within 52 weeks of previously claiming HB the 13 week delay will not apply this time.
The maximum rent rules will affect you, where they do not already, if on or after 2 January 1996:
- you move to a home rented from a private landlord
- you live in private rented accommodation and make a new claim, or renew your claim for HB after a gap of more than four weeks.
Local Housing Allowance
Between October 2003 and February 2004, nine pathfinder local authorities introduced a new method of calculating Housing Benefit for private tenants called the Local Housing Allowance (LHA). From April 2005 to July 2005 a further nine new LAs, called (2WG) also implemented the LHA. While calculation of the customer’s applicable amount and income remains the same, affected customers receive a standard allowance based on the size of their household and the area in which they live. The allowances are published in advance, so that customers can find out how much rent Housing Benefit could pay for before they rent a property.
The allowances represent broadly average rents in an area and are calculated in a similar way to existing local reference rents. The size criteria on which entitlement is based are the same as in the current Housing Benefit scheme. For example, a household consisting of a married couple and their 14-year-old son would be entitled to the rate for a three-room property (i.e. two bedrooms and one living room) in a particular area.
As well as changing the way Housing Benefit is calculated for these tenants, changes have also been made to the way it is paid. Tenants are no longer able to choose to have payment made to the landlord. However, if the local authority thinks the tenant is unlikely to pay the rent or is unable to cope with this responsibility, they can make payment to the landlord. As now, payment will be made to the landlord if the tenant has built up eight weeks of arrears.