Housing Benefit

Housing Benefit is a means-tested DWP benefit that helps people on a low income with their rent. It is a legacy benefit that is being phased out: new working-age claimants are routed to the Universal Credit housing element instead, and a managed migration of the remaining HB caseload to UC is in progress. Housing Benefit continues to operate for two groups — pensioners and tenants of supported/temporary accommodation — and PolicyEngine models it alongside the UC housing element so reform analyses can move between the two systems cleanly.

Parameters live in policyengine_uk/parameters/gov/dwp/housing_benefit/ and the formulas in policyengine_uk/variables/gov/dwp/housing_benefit/.

Eligibility¶

housing_benefit_eligible requires the benunit to be either in social housing or eligible for the Local Housing Allowance rate (broadly, private renters), with assessable capital at or below the working-age (or pension-age) capital limit, and to reach Housing Benefit by one of two routes:

• Pension age: the claimant and any partner have reached the qualifying age for State Pension Credit (State Pension age), or the family is a mixed-age couple that keeps the pension-age route: one entitled to Pension Credit or pension-age Housing Benefit on 14 May 2019 and ever since (SI 2019/37 art. 4), or any mixed-age couple not reported on Universal Credit before 15 May 2019 (meets_pension_credit_age_conditions). New Housing Benefit claims are open to them (SI 2014/1230 reg. 6A(4) and (5)), and Universal Credit is not, so neither a previous claim nor would_claim_uc matters.

• Continuing award: any other benunit was already claiming Housing Benefit (proxied by a positive housing_benefit_reported) and is not claiming Universal Credit. Working-age families, and mixed-age couples without the saving, cannot make new claims; they claim the Universal Credit housing element instead.

The pension-age test counts the same benunit members as Universal Credit’s working-age test, and the continuing-award route requires not claiming Universal Credit, so no benunit receives both.

Parliament abolished Housing Benefit in Welfare Reform Act 2012 s. 33(1)(d). Under SI 2025/1148 art. 7, the abolition takes effect on 1 July 2026 for each award that hasn’t already ended under SI 2014/1230 reg. 7(2), 8(2A) or 46(1)(a) and isn’t due to end after a two week run-on (art. 7(1) and (3)), with these exceptions:

• For a claimant whom the Universal Credit Regulations 2013 reg. 19(1)(b) or (c) (prisoners and others) bar from Universal Credit immediately before 1 July 2026, the award ends on the day after the bar last applies (art. 7(2)).

• The award continues where the claimant’s circumstances fall within SI 2014/1230 reg. 6A(2) to (5): specified or temporary accommodation; a single claimant who has reached the qualifying age for State Pension Credit, or a couple or polygamous marriage in which every member has; a claim that reg. 6A(3) allows when a Universal Credit claimant reaches that age; or a mixed-age couple whose older member claims and keeps a saving under SI 2019/37 art. 4(1) (art. 7(4)(a)).

• The award continues where, immediately before 1 July 2026, the claimant has an income-related Employment and Support Allowance award that art. 3A(2) saves: at that time someone acts for the claimant as an appointee under reg. 57 of the Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013, or in the six months ending on that day the Secretary of State determined that the claimant would likely need one (art. 7(4)(b)).

PolicyEngine does not yet model the 1 July 2026 end date: no rule in the model ends a working-age family’s continuing award on that date. It also doesn’t model claims for specified or temporary accommodation, which reg. 6A(2) keeps open at any age.

Guarantee Credit passport. If the claimant or partner is in receipt of a guarantee credit (in_receipt_of_guarantee_credit: the benunit is eligible for Pension Credit, claims it, and its guarantee credit is positive, so the Pension Credit paid includes a guarantee credit), the whole of their capital and income is disregarded (SI 2006/214 reg. 26; Northern Ireland: SR 2006/406 reg. 24). housing_benefit_assessable_capital, housing_benefit_tariff_income and housing_benefit_applicable_income are then zero, so the capital limit cannot bite and no income is tapered. A guarantee credit computed for a family that does not claim Pension Credit (would_claim_pc), or that PolicyEngine does not treat as eligible for it (is_pension_credit_eligible), does not count. The passport applies within the pension-age regulations (housing_benefit_pension_age_regulations_apply). is_pension_credit_eligible retains mixed-age couples covered by the SI 2019/37 art. 4 saving through meets_pension_credit_age_conditions; these couples keep the passport when they receive Guarantee Credit. When Pension Credit is frozen, receipt follows the baseline award, including its Guarantee Credit component. Savings Credit alone follows the separate assessment in reg. 27, including its capital limit, and does not give this passport.

would_claim_housing_benefit decides take-up for each benefit unit. In simulations built from data, including the Enhanced FRS, it defaults to true only for families that report Housing Benefit, the same rule would_claim_council_tax_reduction applies to Council Tax Reduction (#1831). In hand-entered household calculations, it is true when the family reports Housing Benefit or its claims_all_entitled_benefits flag is true. That flag tests seven reported benefits within the family; it does not test Pension Credit, Child Benefit or Council Tax Reduction. Dataset and situation inputs can override the take-up flag directly.

How PolicyEngine computes Housing Benefit¶

The award is computed in four stages:

1. Eligible rent: the rent the benunit is liable for (benunit_rent). Where the Local Housing Allowance applies (LHA_eligible: renting, and no member in social housing), the eligible rent is the maximum rent (LHA), which is the LHA rate for the Housing Benefit category of dwelling (housing_benefit_LHA_category: the shared accommodation rate for a young individual with no non-dependant, or a claimant entitled to one bedroom who lacks exclusive use of self-contained accommodation, unless the severe disability premium applies, reg 13D(2)) or, where the rent is lower, the rent (LHA_cap; SI 2006/213 regs 12D(2)(a) and 13D(5)).

2. Applicable amount (housing_benefit_applicable_amount): a personal allowance derived from the benunit’s composition (single, couple, lone parent) and age, plus any disability/carer premiums. This is the “minimum income” the household needs before HB tapers begin.

3. Means test (housing_benefit_entitlement): the appropriate maximum Housing Benefit is the eligible rent less housing_benefit_non_dep_deductions for any non-dependant adults living in the household (reg. 70). The published withdrawal_rate (currently 0.65) of the benunit’s housing_benefit_applicable_income in excess of the applicable amount is deducted from that maximum (SSCBA 1992 s. 130(3)(b), reg. 71). Because the LHA caps the eligible rent, the taper comes off the LHA: a private tenant with rent above the LHA and income above the applicable amount receives the LHA less the taper, not the lower of the LHA and the rent less the taper. The pension-age regulations (SI 2006/214) have the same rules at regs 12D, 13D, 50 and 51, and the Northern Ireland regulations at SR 2006/405 regs 13C, 14D, 68 and 69 and SR 2006/406 regs 13C, 14D, 48 and 49. Applicable income counts earnings, pensions and benefits net of the income tax and National Insurance on them. Income derived from capital (rent from property, interest and dividends) is not income: regulation 46(4) of the Housing Benefit Regulations 2006 treats it as capital, and Schedule 5 paragraph 22 of the pension-age regulations disregards it. The capital counts instead through housing_benefit_tariff_income and the capital limit. Rent for letting part of the home is the exception: it counts, less £20 a week per occupier. If the claimant or partner is on Universal Credit, Income Support, income-based Jobseeker’s Allowance or income-related Employment and Support Allowance (housing_benefit_on_passporting_benefit), the whole of the family’s earnings, other income and capital is disregarded (SI 2006/213 Sch. 4 para. 12, Sch. 5 para. 4 and Sch. 6 para. 5; Northern Ireland: SR 2006/405 Sch. 5 para. 12, Sch. 6 para. 4 and Sch. 7 para. 5). housing_benefit_applicable_income and housing_benefit_assessable_capital are then zero, so the award is that maximum. This applies at any age: a mixed-age couple whose younger member is on one of these benefits is assessed under the working-age regulations (SI 2006/213 reg. 5(1)(b)). Income Support, income-based Jobseeker’s Allowance and income-related Employment and Support Allowance count when a positive amount is paid on the claimant’s or partner’s award (in_receipt_of_income_support_jsa_ib_or_esa_ir, which reads claimant_or_partner_jsa_income and claimant_or_partner_esa_income). Another member’s own award, such as a non-dependant’s, is payable to them and does not passport the claimant. A person is on Universal Credit on any day they are entitled to it, whether it is in payment or not (reg. 2(3B)); PolicyEngine reads that as Universal Credit above nil before the benefit cap and deductions (is_uc_entitled), for a family that claims it, so the passport adds no circular dependency through the benefit cap. The universal credit limb applies from 28 October 2013 in Great Britain and 8 May 2018 in Northern Ireland (gov.dwp.housing_benefit.means_test.universal_credit_passport). It matters only where Housing Benefit is paid alongside Universal Credit, for specified or temporary accommodation, which the eligibility rules above do not yet model.

4. Benefit cap (housing_benefit): the post-means-test award is finally reduced by housing_benefit_benefit_cap_reduction, the excess of the family’s welfare benefits over the Housing Benefit cap (housing_benefit_benefit_cap, SI 2006/213 reg 75CA), leaving at least 50 pence a week (reg 75D). The cap does not apply where the claimant or couple is entitled to working tax credit (reg 75E), the claimant or partner receives a benefit listed in reg 75F, or the claim is under the pension-age regulations (reg 5). Universal Credit has its own cap.

The take-up gate (would_claim_housing_benefit) is applied inside housing_benefit_pre_benefit_cap.

Local Housing Allowance rates¶

A private renter’s eligible rent is capped at the Local Housing Allowance (LHA) for their Broad Rental Market Area (BRMA) and category of dwelling: shared accommodation, or one to four bedrooms. Housing Benefit has its own category (housing_benefit_LHA_category, reg 13D of the Housing Benefit Regulations 2006), and its rate is housing_benefit_LHA_rate; Universal Credit’s category is LHA_category. Rent officers determine the rates each January for the year from April. In England this is the Valuation Office Agency, in Wales Rent Officers Wales, in Scotland Rent Service Scotland, and in Northern Ireland the Northern Ireland Housing Executive.

PolicyEngine reads the published determinations from parameters/gov/dwp/LHA/lha_published_rates.csv.gz. scripts/build_lha_published_rates.py builds that table from the source files listed, with their hashes, in lha_published_rates_sources.csv. For each determination from April 2020, the rate is recomputed from the published 30th percentile rents, following Schedule 3B to the Rent Officers (Housing Benefit Functions) Order 1997:

1. the lower of the percentile rent and the national maximum (gov.dwp.LHA.maximum), paragraph 2(2), rounded to the nearest penny (paragraph 2(10));

2. raised to the rate of any smaller category, paragraph 3;

3. for determinations from April 2024, no lower than the rate determined on 31 March 2020 (gov.dwp.LHA.march_2020_minimum), paragraph 3A.

While gov.dwp.LHA.freeze is true, the rates of the last unfrozen year apply (the Modification Orders for 2021 to 2023, 2025 and 2026). A year is the fiscal year from April, so 2025 means April 2025 to March 2026. These rules reproduce every published rate since April 2020. Where a publisher gives no separate percentile for a reset year (Wales and Northern Ireland in April 2020, Northern Ireland in April 2024), the published rate stands in for it, so for those cells the match shows only that the rules leave an unadjusted rate alone. Universal Credit has its own monthly determination (Schedule 1 to the Universal Credit Functions Order 2013), with monthly maxima (gov.dwp.LHA.maximum_monthly). Its monthly tables come from DWP for Great Britain and from nidirect for Northern Ireland from April 2024; Northern Ireland’s earlier monthly rates were not published, so the model converts the weekly percentile (365/7 weeks a year over 12 months). Rent Officers Wales’s April 2022 and 2023 tables restate 14 of the weekly April 2020 rates they say they hold, and DWP’s monthly tables restate the same 14 plus three more by a penny or two. Each restated figure is a round rent (16 of the 17 monthly figures are multiples of £5; the other, Vale of Glamorgan one-bedroom at £434.52, is £100 a week), which reads as a correction, so the model takes them as published: a held year adjusts the held determination’s percentile rent (so a reform to the maximum still binds), and the March 2020 minimum uses the restated figures. Determinations before April 2020 are used as published, because the model does not encode the rules of that period: CPI and 1% uprating, then the 2016 to 2020 freeze with targeted affordability uplifts.

Reforms work as follows:

• Lifting a freeze uses the percentile rents published for that year where they exist. The VOA, Rent Officers Wales and the Scottish Government publish them even for frozen years. The NIHE has not since 2018, so Northern Ireland, and the few Welsh cells missing from a table, use the latest earlier percentile grown with gov.indices.private_rent_index.

• Beyond the latest table, the latest percentile rent grows with gov.indices.private_rent_index.

• A percentile other than the 30th (gov.dwp.LHA.percentile) scales the published one by the ratio of the two percentiles in the model’s list of rents for the same BRMA and category. The English lists are the VOA’s and the Scottish lists are Rent Service Scotland’s own. The Welsh and Northern Irish lists in the file are copies of English ones, so those BRMAs take the median English ratio for the category.

Personal allowances¶

The applicable amount uses age- and household-composition bands. The chart below shows how the weekly allowances have evolved.

Since 1 April 2021 the pension-age allowances depend on when members of the benunit attained State Pension age (SI 2006/214 Sch. 3 para. 1, as amended by SI 2021/188; Northern Ireland: SR 2006/406 Sch. 4 para. 1). A single claimant or lone parent who attained it before 1 April 2021, or a couple in which either member did, keeps the higher allowance (aged, £256.00 single and £383.35 couple a week in 2026-27). Where every member attained it on or after that date, the lower allowance applies (aged_from_cutoff, £238.00 and £363.25). housing_benefit_attained_pension_age_before_cutoff compares each member’s state_pension_age_date, the day set by their date of birth under the Pensions Act 1995 timetable, with pension_age_cutoff. The regulations do not settle a couple in which one member has not yet reached State Pension age and the other reached it after the cutoff; PolicyEngine gives it the lower allowance, following the explanatory note to SI 2021/188.

Council Tax Reduction reuses these allowances. England’s pensioner scheme has the same split and amounts (SI 2012/2885 Sch. 2 para. 1, as amended by SI 2021/29). The Scottish (SSI 2012/319 Sch. 1 para. 2) and Welsh (SI 2013/3029 Sch. 2 para. 1) schemes keep one pension-age rate, the higher one.

References¶

• Social Security Contributions and Benefits Act 1992, s. 130 — the primary statute creating Housing Benefit.

• The Housing Benefit Regulations 2006 (SI 2006/213) and The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 (SI 2006/214) — the operational regulations for working-age and pension-age claimants respectively.

• DWP, Housing Benefit: detailed information — user-facing guidance covering the move to Universal Credit.

• DWP, Housing Benefit caseload statistics — official caseload and expenditure outturns used by policyengine-uk-data for calibration.