Under-occupation in social housing

This has been called ‘the bedroom tax’ by the media.

The Government introduced new rules to restrict the number of bedrooms you can get housing benefit for if you are renting from:

  • a local authority,       
  • a registered housing association, or   
  • any other registered social landlord, such as a voluntary organisation or charity.

Claimants renting in the private sector already have their rent restricted based on the number of rooms they need and Local Housing Allowance (LHA) rates that apply to the area they live in. Further information about the LHA rates is available here.

Since April 2013, the number of bedrooms you are allowed housing benefit for will be based on the number of people in your household.

The new rules allow one bedroom for:

  • every adult couple

  • any person aged 16 or over

  • any two children of the same sex under 16

  • any two children aged under 10

  • any other child

  • a disabled child who cannot share with another child

  • a carer (or team of carers) who do not live with you but provide you or your partner with overnight care

  • an approved/registered foster carer

  • a parent of armed forces personnel who are away from home on operations.

  • a person who is temporarily away from home with the intention to return because they are a carer, studying or in hospital or residential care

The under-occupation subsidy changes will affect you if you:

  • live in a council or housing association property, and

  • have more bedrooms than you need under the rules, and

  • are below state pension credit age.

Pensioners are not affected by these rules.

If you are under-occupying (living in a house with more bedrooms than you need), your housing benefit will be reduced by:

  • 14% of your rent if you are under-occupying by 1 bedroom

  • 25% of your rent if you are under-occupying by 2 bedrooms or more

If you are under-occupying and your housing benefit is currently less than 14% of your rent, your benefit will stop completely.

There are certain circumstances where the size limit rules will not be applied.
  • Non-Mainstream accommodation – These are mooring charges for houseboats and site charges for caravans and mobile homes as well as various “excluded tenancies” such as regulated tenancies.

  • Temporary accommodation – Any claimant who is placed in temporary accommodation by the local authority because they are homeless or to prevent homelessness.

  • Exempt accommodation – The size limit rules will not be applied to those in supported ‘exempt’ accommodation. This is a particular type of supported accommodation – contact us if you live in accommodation which includes care and support to find out if it is exempt.

To avoid being affected or reduce the impact of the under-occupation deduction or ‘bedroom tax’ Housing Benefit claimants can:

  • Move to smaller accommodation by registering on Homeswapper to seek a mutual exchange with other tenants.

  • Find a lodger to occupy the spare room and to pay you rent (but check that this will not affect your benefits first (speak to Jobcentre Plus and the Housing Benefit Office).

  • Apply to our Money Advice service so we can help you budget and plan to pay your rent and reduce expenditure and seek ways of increasing money coming in.

  • Apply for a Discretionary Housing Payment from the Council to top up your Housing Benefit.

A recent announcement by the Government has allowed a small number of claimants to be exempted from the bedroom tax for a short period from 1st April 2013. It came to light through appeals and legal challenges that due to some benefit regulations issued in 1995 that some housing benefit claimants currently affected by the spare room deduction were in fact protected from the change until the Government changes the regulations. It has been called the ‘bedroom tax loophole’ and in certain cases the spare room deduction can be removed until the new regulations remove this protection which comes into effect on 4th March 2014. The conditions to qualify for this protection are as follows:

  • Entitled continuously to Housing Benefit from 1 January 1996 and

  • Living in the same address (except if it had to be vacated due to an emergency such as fire, flood, explosion, etc)  and

  • Any gap in entitlement is less than four weeks or up to 52 weeks where the claimant or partner was a welfare to work beneficiary.

The Council has checked cases that appear to have been continuously entitled since 1996 and removed the spare room deduction until the protection ends on 4th March 2014. This currently totals 18 cases that qualify so far but some people are coming forward if they believe they satisfy these conditions so records can be checked further if necessary. Where a Discretionary Housing Payment has been awarded due to the spare room deduction being applied this may have been overpaid if the amended Housing Benefit covers the shortfall so we will need to recover the Discretionary Housing Payment so we can re-use it to help other families that need it.