Benefit Cap Information & FAQs
If you receive Housing Benefit or Universal Credit then you might be affected by the benefit cap. This is a limit on the total amount of welfare benefits that working age households can receive. The cap was introduced by the government with the stated intentions of:-
- making financial savings (i.e. reducing the deficit);
- increasing incentives to work;
- making the system fairer to working people;
- reducing long-term benefit dependency.
If you are capped then you should have been notified by the DWP, and you will be notified by the Council when the Housing Benefit cap is applied.
You must always make sure your rent is paid in full each week. Failure to pay your rent is likely to lead to you becoming homeless.
If you are worried about how you will afford your rent then there is advice below about what to do. You can also seek advice and guidance about this subject from Citizens Advice. There are other charities and organisations listed below who may be able to help with money and debt advice and support.
Frequently Asked Questions
What is the benefit cap?
It is a limit on the total amount of welfare benefits that working age households can receive.
The cap applies to households in receipt of Housing Benefit or Universal Credit unless exempt.
Which benefits will be capped?
The cap is only applied to Housing Benefit and Universal Credit. Other benefits can count towards calculating the cap, but these are the only ones that can actually be capped.
Which benefits are counted in the cap?
The cap is calculated based on the total of the following benefits that the claimant receives:-
- Bereavement Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance (except Support Group)
- Housing Benefit (except Supported Accommodation)
- Incapacity Benefit
- Income support
- Jobseeker's Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Widowed Parent's Allowance
- Widowed Mother's Allowance
- Widow's Pension.
How much is the cap?
The cap is currently £384.62 per week for couples and people with children. The cap for single people is £257.69.
How will the cap affect me?
You can go to the government benefit cap calculator (with all your household benefit and income details) to get an idea of how you may be affected.
Alternatively, Citizens Advice should be able to give you face to face advice. And there are other online benefit calculators which are free to use.
What can I do to avoid the cap?
If you work enough hours to qualify for Working Tax Credit then you will not be subject to the cap. You should find you are much better off financially if you work to avoid the cap.
If you are disabled, or if you are unable to work, you could seek advice about whether you could be entitled to one of the exempting benefits (see exemptions, below).
How many hours do I need to work to qualify for Working Tax Credit and avoid the cap?
The rules on this are complicated and if your situation is not obviously covered below, seek further advice. The weekly requirements include the following:-
- A person over 25 will need to work at least 30 hours.
- A couple with children will need to work at least 24 hours between them (with at least one working at least 16 hours).
- A single parent will need to work at least 16 hours.
- A single person of 60 years or more will need to work at least 16 hours.
- A single disabled person may only need to work a minimum of 16 hours.
Where can I get help if I am capped?
Anybody can go to their local Citizens Advice for help. Information is available online at their website.
If you are a council tenant then please contact the Rent Account Team if you think you will have problems because of the cap. Call 01903 737723.
If you are a housing association tenant then your landlord should be able to help you.
There is a list of contacts at the end of this FAQ.
How can I be sure I’ll be better off if I find work or increase my hours?
When the cap was first introduced, the government said one of its intentions was to increase incentives to work. So the cap has been designed to make sure that there is real financial advantage to working. By going to work you will lose some means-tested benefits but these should be more than made up for in earnings, Working Tax Credit, and the removal of the cap.
You can check your benefit entitlement and compare different situations on websites such as www.turn2us.org.uk. Alternatively, your local Citizens Advice should be able to carry out a detailed benefit check and “what if” calculation with you.
Who is exempt?
You may be exempt from the cap if:-
- a member of the household is receiving:-
- Disability Living Allowance (DLA)
- Personal Independence Payment (PIP)
- Carer’s Allowance
- Guardian’s Allowance
- Armed Forces Independence Payment (AFIP)
- Attendance Allowance
- Industrial Injuries Benefit and equivalent payments as part of a war disablement pension or armed forces compensation scheme
- War Widow's or Widower's Pension;
- the claimant or partner is receiving Support Group ESA;
- the claimant or partner is over Pension Credit age (unless one of the couple is under PC age and claiming HB and a working age benefit);
- the claimant or partner is working enough hours to qualify for Working Tax Credit;
- the claimant or partner was employed for 50 out the 52 weeks before they stopped working, (this exemption lasts up to 39 weeks).
I’m already struggling to manage, how will I cope with even less money?
If you are unable to work, or to increase your hours so that you can avoid the cap, and if you are not exempt from the cap, it is very important that you continue to pay your rent. Failure to pay your rent is likely to result in your eviction. The cap has been introduced by the government and we have no discretion about whether to apply the cap. If you need some help while you look for work (or while you look into whether you could be exempt) you can apply to the council for Discretionary Housing Payments which might help tide you over temporarily.
If you are being capped and are not seeking employment or an exemption then you will have to budget so that you can still afford your rent and essential expenditure from your income. There are many organisations that can help you with budgeting – online and face to face. A good place to start is the Money Advice Service website, or you can call them on 0800 138 7777. As well as having a lot of advice, they have links to other organisations that might be able to help you.
Alternatively you may have to find more affordable accommodation.
How do I get Discretionary Housing Payments?
There is no guarantee that you will be able to get DHP. You can contact the Housing Benefit department for an application form or see the Discretionary Housing Payments web page. You will need to provide details of your income and expenditure and you may be required to provide details about what you are doing to improve your situation.
How long will I get Discretionary Housing Payments for?
DHP awards in Arun are not usually made for more than six months at a time. They are usually used to help people get through temporary financial difficulties – and to give them time to sort out their situation. You might be able to get a repeat award, but you may need to show what you have been doing to improve your situation.
Organisations and websites where you might be able to get free help and advice
Citizens Advice – offices at Anchor Springs, Littlehampton, and Clarence Road, Bognor Regis.
Citizens Advice website – www.citizensadvice.org.uk
Adviceline Number: 0344 477 1171
Adviceline (Mobile Phones Only): 0300 3300 65
For advice on benefits and money generally.
Online benefit checker - www.turn2us.org.uk
To find out how much you should get in benefits, and how your total income will change when you start or increase work.
The Money Advice Service – www.moneyadviceservice.org.uk (includes webchat) or 0800 138 7777
For money advice: dealing with debts, budgeting, managing your money, and general financial wellbeing.
Also has links to debt advice services.
Stepchange – www.stepchange.org or 0800 138 1111
Debt advice charity. As well as advice, Stepchange can support with some methods of clearing your debts.
Money Saving Expert – www.moneysavingexpert.com
Website (founded by Martin Lewis) which is full of useful information about ways to make savings on all sorts of products and services.
Christians Against Poverty – www.capuk.org
CAP offer free face-to-face help including debt counselling, help with finding work, and their Money Course which helps teach how to budget effectively. The services are open to all people of any religion (or none).
Government website – www.gov.uk
You can find out more about Working Tax Credits at https://www.gov.uk/working-tax-credit
You can find out more about looking for work at https://www.gov.uk/jobsearch