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How benefits are calculated

Housing Benefit is available to you if you are renting and on low income. It is to help you pay the rent. You cannot apply for Housing benefit if you are on Universal Credit unless you are in temporary or supported accommodation.

An applicable amount is the minimum amount the Government says you and your family need to live on each year. It is made up of your:

• personal allowance

• personal allowances for children

• premiums.

To find out more about Housing Benefit, visit GOV.UK.

Personal allowances and premiums

The applicable amount you get will include a personal allowance depending on your age, whether you are single, living as a couple, or have children.

The applicable amount may include a premium for:

• having a disability

• being of pensionable age

• caring for someone

• being a family.

Income and savings

Your income is all the money you and your partner get. This includes:

• earnings from any employment

• pensions

• tax credits

• other benefits

• savings over £6,000

Some benefits are disregarded. These include:

• Attendance Allowance

• Disability Living Allowance

• Personal Independence Payment

• War Pension.

Capital includes all savings, investments that you or your partner have, and the value of any property or land you own but don’t live in.

If you are of working age and have £16,000 or more in savings or assets, you will not be entitled to Housing Benefit. If you have £6,000 or more, you will not be entitled to Local Council Tax Support.

Capital under £6,000 will be disregarded. If you are working age, savings between £6,000 and £16,000, every £250 will count as £1 income a week.

If you are of pensionable age, any savings you have under £10,000 will be disregarded when we assess your claim. If you have savings between £10,000 and £16,000, every £500 will count as £1 income a week.

If you have £16,000 or more, you will only get Housing Benefit or Local Council Tax Support if you are getting the Guaranteed element of Pension Credits.

View our guide if you need help understanding your benefit award.

To find out what benefits you could get including Housing Benefit, use the benefits calculator.

If you are using the benefit calculator to see if you qualify for Local Council Tax Support, it will only give an estimate if you are of state pension credit age. If you are working age, visit Local Council Tax Support to find out more.

Calculation

We use the rent from the Local Housing Allowance rates or the eligible rental charge if you’re in the social sector. Visit Directgov for your current rate. We work out the difference between your income and your applicable amount. This is called your excess income. The council takes away 65% of the excess from the help you can get with your rent (65% is 65p in every £1). Local Council Tax Support is reduced by 20% for Pensioner aged claimants.

If you live with your partner, your Housing Benefit and Local Council Tax Support will be based on your joint income and capital.

Total weekly income used in calculation
Earnings£200
Child Tax Credit£150
Working Tax Credit£50
Total£400
Minus working tax disregard£17.10
Minus earnings disregard£10
Total net income£372.90
Minus your personal allowance of £199 (couple £114.85, one child £66.90, family premium £17.25)
Total excess income£173.70
Less 65%£112.91
2 bedroom LHA rate£121.15
Minus income£112.91
Housing Benefit entitlement£8.24


Your notification award letter will tell you when your Housing Benefit payment is due. It is paid two weeks in arrears to your bank account. It will be in four weekly in arrears if paid to the landlord or housing association.

Benefit cap

There is a cap in place to limit the amount of certain benefits that a working age household can get. If your household is getting more than the cap, your housing benefit will be reduced.

The cap is currently set at £20,000 per year for a:

• couple

• lone parent.

The cap is set at £13,400 per year for:

• a single claimant

• anyone living outside London.

Find out more on GOV.UK.

Non-dependants

A non-dependant is someone aged over 18 who:

• lives with you

• is not your partner

• is not a child for whom you receive Child Benefit.

Whether they help with your housing costs or not, we must take a set amount off your benefit according to their income.

DeductionsRates 2022 to 2023 (£)
25 years old and over in receipt of Income Support and income-based Job Seekers Allowance (JSA)16.45
Any age in receipt of main phase income-related Employment and Support Allowance (ESA)
16.45
18 years old or over, not in remunerative work
16.45
18 years old or over and in remunerative work
Rates 2022 to 2023 (£)
Gross income: less than £154
16.45
Gross income: £154 to £223.99
37.80
Gross income: £224 to £291.99
51.85
Gross income: £292 to £388.99
84.85
Gross income: £389 to £483.99
96.60
Gross income: £484 and above
106.05


If in receipt of Local Council Tax Support, a £2.00 deduction will be applied for each non-dependent.

Deductions are not made if you or your partner are:

• registered blind

• in receipt of Attendance Allowance

• getting the care component of Disability Living Allowance (DLA)

• getting the daily living component of Personal Independence Payment (PIP)

• in receipt of Armed Forces Independence Payments.

No deduction is made if the non-dependant:

• is in receipt of a training allowance

• has been in hospital for 52 weeks or more

• is a prisoner or otherwise detained

• is in receipt of Pension Credits

• is a full-time student

• a member of the Armed Forces who is absent while on operations.


Some of the information on this page links back to our council website (iow.gov.uk)

Contact information

Benefits

Isle of Wight Council Revenues Services
PO Box 238
Newport
PO30 9FP

Monday to Thursday 8.30am to 5.00pm
Friday 8.30am to 4.30pm