The benefit cap - how to cope if you're affected

Couple discuss bills on bed Creative image #:  82562876  License type:  Royalty-free  Photographer:  Simon Potter Collection:  C

The benefit cap is a limit on the amount of benefits a UK citizen can receive when they are of working age, and was designed to persuade some of those claiming benefits back into work. Affecting those who are already receiving housing benefit or universal credit, the cap means a reduction in the money coming in, and that can leave some struggling to pay the landlord. If you are affected by the benefit cap, here are some tips on the options available.

What is the benefit cap and how does it work?
A limit on the total amount of benefits a working-age Brit can receive, the benefit cap means that if your benefits income goes above a certain level, your housing benefit or universal credit will be cut by that amount. Current limits stand at £500 a week for couples with or without dependent children, and for single parents with dependent children, or £350 if you are single with no children. Therefore, a couple receiving benefits income (including housing benefit) of, say, £50 over the limit, the housing benefit sum would be reduced by that £50. Where the reduction would mean housing benefit was lost completely, a nominal amount of 50p would continue to be paid.

How to avoid the cap
Avoiding the benefit cap isn't easy, but there are options. The most obvious of these is to find work or increase your working hours enough that you can claim working tax credit. This is aimed at those who are working but still on a low income, and the amount you receive will depend on how many hours you work and how much money comes into the household, so it is worth checking with your local authority or Citizens Advice as to whether you qualify, as this will mean the cap does not apply.

Also worth noting are the other benefits that aren't counted or that rule out the use of the cap. If you or anyone in your household receives Disability Living Allowance, Personal Independent Payment, Armed Forces Independence Payment, Attendance Allowance, the support element of Employment and Support Allowance, Industrial Injuries Benefit and War Widow's or Widow's Pension, then the cap will not apply. Those receiving the state pension or pension credit may also be exempt, although that may not be the case if you are in a mixed-age couple. Those living in certain supported accommodation, i.e. a nursing or care home, are also likely to be exempt. There is also a 'grace period' of 39 weeks for those who worked at least 50 weeks of the 52 weeks leading up to their last day of employment.

Assistance for those affected
If neither you nor anyone in your household claim any of those benefits that exempt you from the cap, it may be worth considering moving to cheaper accommodation, or even discussing a rent reduction with your landlord. A Discretionary Housing Payment from your local authority may also be able to help. It may be a short-term payment to help with the rent, or assist you in paying for a deposit or removal costs if you are able to move to cheaper accommodation.

Those with a disabled child that does not qualify for Disability Living Allowance, or whose health may be affected by reduced benefits caused by the cap, should speak to their local Children's Services Department, which may be able to provide a cash payment or further assistance. The local authority also provides homelessness assistance for those that can no longer reasonably afford to continue living in their home, for instance because housing benefit reductions mean you need money normally used for basic essentials in order to keep up with your rent payments. Where this is the case, the council may be able to rehouse you or help you find somewhere else to live.

Where the local authority is unable to help, it may be that there are charities that can. The Turn2us website has a useful benefits calculator tool to help you, and from there, you can search for grants that may be available to those affected by housing benefit reductions caused by the cap.

If you are struggling to cope or worried you may lose your home because of the benefit cap, do seek help. The likes of Citizens Advice can offer further information that may help you to keep your home.

Have you been affected by the benefit cap? Leave your comments below...
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