What is local housing allowance?
Local Housing Allowance is another name for Housing Benefit for tenants who live in privately rented accommodation.
It is a weekly allowance based on the size of your household and the area in which you live and is generally the maximum level of Housing Benefit you will be able to receive for your property. If your actual rent is less than your local housing allowance entitlement then your benefit will be based upon the lower figure. The actual amount of Housing Benefit you will receive will depend on your income and savings etc.
Who sets the Local Housing Allowance rates?
The Local Housing Allowance rates are not set by Hertsmere. They are set by a separate government organisation called the Valuation Office Agency. You can check the Local Housing Allowance rates by visiting the Valuation Office Agency website.
The agency looks at the rents charged in a particular area and then informs us what the maximum level of Housing Benefit we can pay, depending on whether you are entitled to a room in a shared house or a one bedroom, two bedroom, three bedroom or four bedroom property.
The Local Housing Allowance rates will not increase for four years after April 2016, as they have been frozen as one of the Welfare Reform measures.
Who is affected by Local Housing Allowance?
The Local Housing Allowance is used to work out Housing Benefit for all new claims, except for those who fall into the categories below. The allowance will also apply if you are currently on Housing Benefit and you move home or if you have a break in your claim of one week or more.
Local Housing Allowance does not apply if:
- You rent your home from a housing association or a registered social landlord.
- You rent your home from a charity or a voluntary organisation and they, or someone on their behalf, provide you with care, support or supervision.
- Your tenancy began before January 1989.
- You live in a caravan or a houseboat.
- Meals are included in the rent you are charged.
What if my rent is higher than my Local Housing Allowance entitlement?
If you choose to rent a property which is more expensive than your Local Housing Allowance rate, you will have to make up the shortfall in your rent from your other income. Please remember the Local Housing Allowance figures are the maximum level of benefit you can receive, but the amount you are actually entitled to will depend on your income.
So, for example, if you increase your earnings to make up the shortfall in your rent, your Housing Benefit will actually go down as a result of this. It is therefore important that you think very carefully about renting a property which is more expensive than your Local Housing Allowance.
How many rooms can I claim for?
This will depend on the number of people who live with you. However, if you are a single person under the age of 35 with no dependant children, then you will normally only be entitled to the room rate even if you live in self-contained accommodation. However, there are exemptions to this rule, if you are disabled and receive the middle or highest rate of the care component of disability living allowance.
If you (and, if applicable, your partner) have no dependant children and live in shared accommodation, you will normally be entitled to the room rate of Local Housing Allowance, even if you are over 35 years of age. Shared accommodation means that you share a bathroom or cooking facilities with other tenants.
For everyone else with children or non-dependants, the Local Housing Allowance rate is based on the number of bedrooms needed for your household. One bedroom (up to a maximum of four) is allowed for each of the following:
- Every adult couple
- Any other adult aged 16 or other
- Any two children of the same sex up to 16 years old
- Any two children regardless of the sex under 10 years old
- Any other child
- An overnight carer if you or your partner are disabled and have an additional bedroom because a carer stays overnight on a regular basis.
If you have joint custody of one or more children, we will normally only be able to take them into account when calculating your room entitlement if you are the person who receives child benefit for them.
If you are still unsure as to the number of bedrooms that you and your family are entitled to, you can use our online Bedroom entitlement calculator to work out the Local Housing Allowance rate you can claim for.
How is Local Housing Allowance paid?
Payment will normally be made by direct transfer into your bank account every four weeks in arrears. You will then need to arrange payment to your landlord. We cannot make payments direct to your landlord unless we are satisfied that you would have difficulties in managing your own rent payments. However, if you are behind with your rent by eight weeks or more then your landlord can insist we pay them direct.
We cannot pay housing benefit by cheque or by giro, nor can we pay directly into a Post Office account. Anyone claiming housing benefit will therefore need at least a basic bank account.
What are the Local Housing Allowance rates?
You can check the Local Housing Allowance rates by visiting the Valuation Office Agency website.