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Housing Benefit Changes to benefits 2013

Summary: This paper explores the changes to the housing benefit looking at those affected, implications and exemptions.

"The Bedroom Tax"

If you're renting from the local authority, housing association or registered social landlord, then your Housing Benefit may be cut if you are considered to have a spare bedroom. This is sometimes known as the "under-occupation penalty" or the "removal of spare room subsidy".

Who will be affected?

The following rules will be used when working out whether you have a spare room:

  • You will be allowed one bedroom for each person over 16 or a couple in a household.
  • Two children under 16 of the same gender will be expected to share
  • Two children under 10 regardless of their gender will be expected to share

Are there exemptions?

Even if you have a spare room, your Housing Benefit won't be cut if:

  • You or your partner are over the qualifying age for pension credit
  • You're an approved foster carer
  • You have an adult child living at home who is in the Armed Forces (even if deployed away)
  • You have an adult child who is a student and their main residence is your home
  • You receive care, support or supervision from your landlord in supported exempt accommodation
  • Your council has put you in temporary accommodation because you were homeless

In the case of disability, there are exceptions if you have an overnight carer, or a child with a severe disability who is unable to share a bedroom (at the local authority's discretion).

How much Housing Benefit will I lose?

If you're affected you stand to have your Housing Benefit (or Universal Credit) cut by the following percentage:

  • 14% for one extra bedroom
  • 25% for two or more extra bedrooms So for example if your current rent is £400/mth and it's all covered by Housing Benefit then your benefit will be cut by £56 (one extra bedroom) or £100 (two extra bedrooms).

Where can I find help?

If the loss of this benefit creates real hardship you should discuss the matter with your landlord, housing association etc. Sometimes such changes lead to an overview of income/outgoings and cutbacks need to be made. Lifestyle changes may be required, or help with reducing debt repayment levels may be necessary.

(Source: Money Advice Service)

The above is provided as information only. Iva.co.uk does not provide debt advice. You must always seek professional advice before taking any action to resolve your debts.