Factsheet 4. Guide to Under Occupation & Housing Benefit Rules Do you have a spare bedroom? Or does the Government think you have? If you are in receipt of Housing Benefit and are under 61 you may be affected. You could get less Housing Benefit.
Bedroom Tax – what is it? A new government act will have a big impact on some people with a spare room. You will be affected if you are aged under 61 years old on and after 1st April 2013. From April 2013 Housing Benefit will be reduced to allow just one bedroom for each individual or couple that lives in the home, with the following changes: Children under 16 of the same sex are expected to share Children under 10 are expected to share regardless of sex A disabled tenant or partner who needs a non-resident overnight carer will be allowed an extra room. There are no discounts for how small the room is, so even if you can’t fit two children into the room you will still lose some of your Housing Benefit entitlement. You will be affected even if you get a small amount of Housing Benefit. Also, a new benefit cap means tenants under 64 with children or a spouse will get a maximum of £500 in benefits per week, and single tenants can only receive up to £350 per week. This total will include all of your benefits, not just your Housing Benefit. If you have one empty bedroom you will receive 14% less Housing Benefit. If you have two or more empty bedrooms you will receive 25% less Housing Benefit. This means you will have to pay RFHA the difference to make up your rent, or your home could be at risk.
What does this mean? If you are a single person or a couple living on your own in a home with two bedrooms you will receive 14% less Housing Benefit. If you live in a three bedroom property you will receive 25% less. If you are a single parent or a couple living in a 3 bedroom home with two girls or two boys under 16 you will receive 14% less housing benefit. If you live in a four bedroom home you will receive 25% less. If you are a single parent or a couple living in a three bedroom home with a boy and a girl under 10 you will receive 14% less Housing Benefit. If you live in a four bedroom home the cut will be 25%.
Understandably, people will be concerned and will want advice on how to manage on less money or want to look at other options; for example how to make up the drop in income or want to move. Come and talk to us, we have lots of ideas and advice and can guide you through your future options. This could include: Budgeting Advice Advice on taking in a lodger Advice on seeking work or learning new skills Advice regarding swapping to a smaller home Advice if you think you need to move to a smaller home Would you consider downsizing? Downsizing though an exchange could be a better option for you. Please see our leaflet on Mutual Exchange for more details. Waiting lists to exchange are already long and will get longer so you will need to consider all options if you want to downsize.
What are the benefits of downsizing? You will pay lower rent You will pay lower bills such as council tax, gas, electricity and water A smaller home is more manageable and needs less house work Potential Savings This table give some example figures for water, gas and electricity over a year and shows what savings you could potentially make from downsizing: Property Size Four bedrooms Three bedrooms Two bedrooms One bedroom
Water (per annum) 460.00 471.00 403.00 361.00
Gas (per annum) 1302.10 1122.50 673.50 449.00
Electricity (per annum) 863.40 791.45 575.60 359.75
Total (per annum) 2625.50 2384.95 1652.10 1169.75
Water rates taken from whatprice.co.uk. Figures for gas and electric are taken from The Energy Saving Trust and are an average as prices vary according to which utility company and how much fuel you use.
Costs associated with moving You may have concerns about the cost of downsizing and that it might outweigh the savings. The average cost of moving and redirecting is outlined below: Service Removals Redirect Post (3 months) Telephone reconnection
Average Cost £350 £19.50 £30
RFHA is able to provide advice and support and may also be able to help with some of the costs involved. You may also be able to get some help through Discretionary Housing Payments. Please contact us for more details and ask for a copy of our Downsizing Fact Sheet for information on the assistance we can offer and financial help available. If you think that you might be affected by the Housing Benefit changes, come and speak to us – we may be able to give you practical help that means you can afford the rent after 2013 when the changes are made. Remember, failing to pay your rent could put your tenancy at risk and result in your eviction. The new rules in this leaflet do not apply to tenants over the age of 61.
Contact us on By email: In person:
01933 411400 info@rfha.org.uk St Peters House 101 Wellingborough Road Rushden Northants NN10 9YL