Housing Benefit

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Housing Benefit Council Tax Benefit The Basics
Housing Benefit Training
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What this presentation covers

• An overview of Housing Benefit and Council Tax
  Benefit
• How to calculate a claimants benefit entitlement
• Examples
• How claimants can query a Local Authority decision

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What are Housing Benefit and Council Tax
Benefit?
Housing Benefit (HB) and Council Tax Benefit
(CTB) are two, separate, means-tested benefits
to enable people on low income to afford their
housing costs. These benefits are administered
by Local Authorities (LAs) and paid from their
budgets. The LA then receives a subsidy from
central government (DWP) to cover the costs
involved.
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Who can claim?
In general, anybody with a liability to pay
Council Tax and/or rent can claim provided

• They are resident in the property,
• They have less than 16,000 in capital (unless
  they are in receipt of guaranteed Pension Credit)
• They can supply proof of their National Insurance
  number and identity

Some groups are specifically excluded, e.g. most
students
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How does someone claim?
There are effectively two ways a claimant can
apply for Housing Benefit or Council Tax Benefit

• Direct to the Local Authority,
• Via the DWP

There are differences depending on which route a
claim is made, but the basic principles are the
same

• The claimant must complete a claim form
• The claimant must provide proof of their rental
  liability
• The clamant must provide evidence of their
  income/capital.

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When does an award start?
Benefit entitlement will normally start from the
Monday after the form has been received by the
LA/DWP, unless

• The claimant or partner is aged 60 or over, or,
• The start date is dependant on an award of
  another benefit, or
• There is a record of the claimant contacting the
  LA/DWP with an intention to claim within a month
  of the claim actually being submitted, or,
• The claim is made within the first week of the
  tenancy, or
• The claim is made in advance of a liability
  commencing or
• The liability is daily

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How long will a claim run for?
Since the 6th April 2004 all claims are
open-ended. A claim will not end unless

• Entitlement to the benefit has ended, e.g. the
  claimants capital now exceeds the limit, or their
  income is too high,
• The claimant moves out of the Local Authoritys
  area
• The claimant has been paid an Extended Payment

However the claimants ongoing entitlement to
benefit should be checked on a regular basis.
These interventions are planned using a
probability risk score of there being a change in
the claimants circumstances
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Making an assessment
The assessment is based on three elements
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1. Liability and Eligibility

• Is the claimant the person responsible for paying
  the Council Tax or Rent,
• Identify what is included in the charge.
• Is the person responsible for paying all of the
  charge?

Once the LA is satisfied that the claimant is
liable, we then have to consider how much is
eligible for benefit. Limits are applied to HB
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1. Liability and Eligibility
Checking the CTB Liability

• Confirm that claimant is the liable person,
• Should a Single Person Discount be applied?
• Establish the amount of Council Tax eligible for
  benefit.

Remember a Second Adult Rebate may be
appropriate.
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1. Liability and Eligibility
Checking the eligible rent for HB purposes

• HB does not pay for
• Water Rates,
• Heating and Lighting Charges
• Hot water and Fuel charges
• Meals
• Care and Support costs

Local Authority rents and most Housing
Association rents will be considered eligible,
net of the above items.
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1. Liability and Eligibility
Checking the eligible rent for HB purposes
However private tenants will have their rent
referred to a Rent Officer who will make a
decision on the rent figure eligible for HB
purposes. A further restriction applies to
single claimants under 25 who are not lone
parents or disabled. It is called the Single Room
Rent (SRR). The SRR restricts the amount
eligible to an amount equivalent to that for
shared accommodation even if the claimant has a
self contained flat
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2. Income and Capital
Comparing the level of income with the level of
need
As with any means tested benefit, any award is
based on a comparison of the claimants needs
with their actual resources. Claimants will have
their income assessed and this is compared with
their level of need, any excess income will have
a TAPER applied.
Those on IS, JSA (income based) and Guarantee
Pension Credit are passported to full benefit.
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2. Income and Capital
Identifying the claimants income

• Income to be taken into account
• Earned Income, e.g. wages, net of any
• Tax, National Insurance and ½ of any private
  pension contribution
• Childcare costs up to
• 175.00 for a single child,
• 300.00 for two or more children,

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2. Income and Capital
Identifying the claimants income

• Income to be taken into account
• Earned Income, e.g. wages, net of any

• Earned income disregard
• 5.00 for a single person,
• 10.00 for a couple
• 20.00 for a disabled worker
• 25.00 for a lone parent
• 15.45 additional earnings disregard

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2. Income and Capital
Identifying the claimants income
Income to be taken into account

• Unearned Income taken fully into account e.g.
• Retirement Pension
• Child Benefit (working age claims only)
• Unearned income taken partially into account
  e.g.
• War Pensions/Armed Forces Compensation Scheme

Some unearned income, such as Disability Living
Allowance, is ignored completely
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2. Income and Capital
Identifying the claimants Capital

• Capital includes
• Bank/ building society accounts,
• stocks and shares,
• Premium Bonds,
• National Saving Certificates,
• the value of a second property, etc

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2. Income and Capital
Identifying the claimants Capital
Capital can take a variety of forms. As a general
rule the DWP define capital as all categories of
holdings which have a monetary value, and which
can be distinguished from an income because it
is

• Made without being tied to a a period and
• Made without being tied to a past payment and
• Not intended to form part of a series of payments

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2. Income and Capital
Identifying the claimants Capital
Capital attracts a tariff income. This does not
reflect the actual income derived from capital
(interest, dividends etc.) but is an assumed
amount. The level of tariff income varies
dependant on the age of the claimant

• 1 for every part of 250 over 6,000 for people
  under 60
• 1 for every part of 500 over 6,000 for people
  60 or over

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3. Level of Need
Establishing the claimants basic living needs
Having identified the resources available to the
claimant and his family, we need to identify how
much of these resources he/she needs to live on,
identified as their Applicable Amount.
For HB/CTB, the Applicable Amount is made up of
two components

• Personal Allowances - basic allowances based on
  the claimants age and family status
• Premiums - additional amounts payable to cover
  special circumstances

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3. Level of Need
Establishing the claimants basic living needs
Consequently, the Applicable Amount will vary
from claimant to claimant and from family to
family depending the personal allowances and
premiums they qualify for. For example
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The benefit calculation
As previously stated, any award of benefit is
calculated by comparing the level of need
(Applicable Amount) with the resources (Income).



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The benefit calculation
When the income exceeds the Applicable Amount,
the excess income is considered to be
available for housing costs. A taper of 65 is
applied (20 for CTB) when an assessment is made.



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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr Mrs Smith are a working age couple. They
have two children, aged 3 and 6. They live in a
Housing Association property with an eligible
rent of 191 per week and an annual Council Tax
of 1,400.
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The benefit calculation
Mr and Mrs Brown are a pensioner couple aged 65
and 66. They live in a LA flat with a rent of 95
a week and a Council Tax liability of 12.50 a
week. They receive a Savings Credit of 9.00 a
week.
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The benefit calculation
Mr and Mrs Brown are a pensioner couple aged 65
and 66. They live in a LA flat with a rent of 95
a week and a Council Tax liability of 12.50 a
week. They receive a Savings Credit of 8.00 a
week.
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Non-dependants
Who are they?
Generally, non-dependants are people in the
household who are 18 and over and not in full
time education. The government believes they
should contribute to the household costs and
tries to ensure this by taking a deduction from
the claimants HB/CTB. There are some
exceptions, e.g. when the claimant is blind or in
receipt of a DLA care component. The amount of
the deduction taken varies depending on whether
the non-dependant is working and the amount
he/she is earning.
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Non-dependants
Who are they?
For example, take one of our previous cases Mr
and Mrs Brown are in receipt of HB of 94.02 and
CTB of 12.20. Their son now moves back into
their home. He is working, earning 300 a
week. Consequently, a deduction of 43.50 will
now be applied to their HB and a deduction of
5.80 applied to their CTB and their entitlements
will be reduced to 50.52 per week Housing
Benefit and 6.40 per week CTB. As Mr and Mrs
Brown are both over 65, the non-dep deduction
will not apply until he their son has been back
in the household for 26 weeks.
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Other points to note
Private Tenants A restriction on the eligible
rent level used in calculating HB may be
enforced if the rent charge is considered to be
unreasonably high, or where the property is
considered to be too large for the claimants
needs.
Single people under 25 As previously stated,
young people will have their HB restricted to
the equivalent of a room in shared accommodation
(there are some exceptions).
Direct payments CTB awards are automatically
credited to the Council Tax Account. Currently
LA Tenants have their HB awards paid directly
into their rent accounts and Private Tenants at
the moment can opt for the HB award to be sent
to their Landlord.
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Other points to note
HB on two homes under certain circumstances HB
can be paid to the same person in respect of two
properties, most commonly when moving from one
address to another.
Temporary absence In some situations a
claimant may still be able to receive HB in
respect of their home even though they are
temporarily living elsewhere (i.e. while in
hospital).
Discretionary Hardship If the level of HB has
been restricted, a claimant may still be able
to have the full rent paid if they can
demonstrate their need.
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Other points to note
In some cases the person who is liable for
Council Tax has too high an income to qualify
for benefit. However there are alternatives.
Single Person Discount If they are living
alone they can qualify for a 25 reduction in
their Council Tax Bill.
Second Adult Rebate (2AR) If they have a
second adult living with them who is not their
partner and that person has a low income, they
may be able to get a reduction of up to 25 of
their CT based on the second adults income.
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Querying the claim
Housing Benefit and Council Tax Benefit, like
most Social Security Benefits, are governed by
rules and conditions which have the force of
law. Consequently anyone who makes a claim for
benefit, and fulfils the specified conditions,
has a legal entitlement to that benefit. They
also have a right to receive a notice outlining
how a decision was made. If a claimant is
unhappy with a decision they can challenge it. In
July 1999 the decision making rules were amended
for the majority of benefits in order simplify
the process. There is now a uniform procedure
that should be followed.