Benefit Cap

In July 2013 a cap was introduced on the total amount of Housing Benefit that working age people can receive, so that workless households can no longer receive more in total benefits than average working families, after tax and National Insurance deductions. For benefit purposes, the household includes all dependants and excludes non-dependants.

Income taken into account

• out of work benefits such as Jobseeker's Allowance, Income Support and Employment Support Allowance unless the support component is in payment
• Housing Benefit
• Child Benefit
• Child Tax Credit
• Universal Credit
• Carer's Allowance
• Maternity Allowance
• Paternity Allowance

Income not taken into account

• budgeting loans
• free school meals
• local Council Tax support
• childcare costs

When the cap will not apply

The cap will not be applied where someone in the household:

• obtains work and is entitled to Working Tax Credits
• is in receipt of War Widow's Pension
• is in receipt of Disability Living Allowance
• is in receipt of Personal Independence Payment
• is in receipt of Attendance Allowance or Constant Attendance Allowance
• is in receipt of the support components of Employment Support Allowance

People who have been in employment for 52 weeks or more when they claim benefits and who lose their jobs through no fault of their own will be exempt from the cap for nine months.

How the cap will be applied

Initially the reduction will be made against the Housing Benefit entitlement. When Universal Credit is applied, it will be make against this new benefit

For further information you should contact the Department for Work and Pensions on 0345 605 7064 or look at the Benefit Cap web pages on gov.uk.