From 7 April 2008, the Housing Benefit regulations changed for private sector tenants and a new way of calculating the maximum rent level was introduced. This is called Local Housing Allowance.
Local Housing Allowance rules
Local Housing Allowance affects Housing Benefit claimants in the deregulated private sector if:
It does not affect claimants who:
- are already in receipt of Housing Benefit
- live in a caravan or hostel
- are Council tenants or housing association tenants
Local Housing Allowance calculation
The maximum amount of Housing Benefit a tenant can receive is set in advance by the Rent Officer – this figure is not dependent on the amount of rent charged. The maximum amount of benefit a tenant can receive is the same for every same size household in the area in which they live regardless of the differences in the actual rents charged.
The number of rooms that a tenant requires is based on Housing Benefit rules.
With the exception of single claimants aged under 35, one bedroom is counted for:
- every adult couple
- any other adult aged 16 or over
- any two children of the same sex until they are 16
- any two children regardless of sex, aged under 10
- any other child
Housing Benefit will be limited to a maximum of a four bedroom property rate regardless of the number of bedrooms required.
Additional room for a non-resident carer
Where the tenant or their partner requires overnight care and they are in receipt of Attendance Allowance or the middle or highest rate care component of Disability Living Allowance they may be entitled to an additional bedroom in the calculation of Housing Benefit. If you think this may apply to you, please contact us straight away.
Single claimants under 35
Single claimants aged under 35 years who live on their own are entitled to the standard rate for a room in shared accommodation.
The broad rental market area
The broad rental market area is set by the Rent Officer and the whole of the East Ayrshire Council area is one broad rental market area.
Setting Local Housing Allowance
The Rent Officer sets the Local Housing Allowance rate for different sized properties within the broad rental market area.
The Local Housing Allowance rates are set in April each year and will not change, even if your rent changes.
Duration of Local Housing Allowance
We will apply the Local Housing Allowance rate from the date you apply for Housing Benefit. It will be re-assessed by us in April each year. If you have a rent increase during that time you will need to pay this yourself as we do not take this into account. We will re-assess your claim if the number of people in the house changes.
Local Housing Allowance payments
Local Housing Allowance is almost always paid direct to the claimant either every two or four weeks by crossed cheque or direct into your bank account using BACS payment depending on whether rent is charged on a weekly or monthly basis.
It is advisable for tenants who do not already hold a bank or building society account to open one (cheques and BACS payments cannot be paid into Post Office accounts). Basic bank accounts are available from most banks, building societies and credit unions.
If you choose to receive payment by cheque you will normally receive this on the Monday following the date it is due. If you choose to receive payment by BACS the payment will go into your bank account on the Tuesday following the date it is due.
We can in certain cases make payment direct to the landlord but we will only do this where we think a tenant will have serious problems in paying their rent, managing their own affairs, or where the landlord has reduced the rent they are charging in order for a tenant to be able to take on the tenancy.
We will make a decision on every case individually and will always speak to the tenant before we come to a decision. We may ask for evidence to support a claim. The tenant, their landlord or someone acting on their behalf may make the application for payment to go to the landlord.
If a tenant is in arrears of eight weeks or more then we can make payments direct to the landlord.
If we pay the landlord instead of the tenant this will be for a limited period and will be reviewed regularly. If the tenant clears the arrears we will consider reverting back to paying the tenant.
Neither the tenant nor the landlord can appeal against the Local Housing Allowance rate. This is because the level is set for the whole broad rental market area and any change would affect people who are happy with the rate.