The Benefit Cap is part of government welfare reforms that place a limit on the amount of benefit you can get if you’re of working age.
The amount you can be paid if you claim certain benefits is limited. It applies to people of working age. People of pension age are exempt.
When all your benefits are calculated, your housing benefit or universal credit is reduced so your total benefits don’t go above the benefit cap limit.
How the Cap May Effect You
Your benefits will be reduced if you get more than the limit that applies for your circumstances – this means you’ll get less Housing Benefit or Universal Credit.
Benefit cap amounts – rates November 2019 to 2020
The benefit cap is worked out:
- weekly if you get housing benefit
- monthly if you get universal credit
If you live outside Greater London, the cap is:
£384.62 per week (£20,000 a year) Couples (with or without children) or single claimants with a child of qualifying age
£257.69 per week (£13,400 a year) Single adult households without children
If you live in Greater London, the cap is:
£442.31 per week (£23,000 a year) Couples (with or without children) or single claimants with a child of qualifying age
£296.35 per week (£15,410 a year) Single adult households without children
For full amounts see Benefit Rates
Benefits the Cap Will Include
The amount your household gets from some benefits might go down to make sure you do not get more than the cap limit. The benefit cap affects:
- Bereavement Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance
- Housing Benefit
- Incapacity Benefit
- Income Support
- Jobseeker’s Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widow’s Pension if you started getting it before 9 April 2001)
- Universal Credit
Who won’t be affected
You’re not affected by the cap if you or your partner:
- get Working Tax Credit (even if the amount you get is £0)
- are over State Pension age
- get Universal Credit because of a disability or health condition that stops you from working (this is called ‘limited capability for work and work-related activity’)
- get Universal Credit because you care for someone with a disability
- get Universal Credit and you and your partner earn more than £542 a month combined, after tax and National Insurance contributions
You’re also not affected by the cap if you, your partner or any children under 18 living with you gets:
- Armed Forces Compensation Scheme
- Armed Forces Independence Payment
- Attendance Allowance
- Carer’s Allowance
- Disability Living Allowance (DLA)
- Employment and Support Allowance (if you get the support component)
- Guardian’s Allowance
- Industrial Injuries Benefits (and equivalent payments as part of a War Disablement Pension or the Armed Forces Compensation Scheme)
- Personal Independence Payment (PIP)
- War pensions
- War Widow’s or War Widower’s Pension
If you are at risk of being capped
If the Department for Work and Pensions (DWP) thinks you are at risk of being capped, based on your current circumstances, they will write to you to explain this. Bear in mind the DWP may not have the most up-to-date information about you when they write to you. Your circumstances may also change between after April 2013.
The DWP has set up a Helpline to help answer questions about the cap. The number is 0845 605 7064 (8am to 6pm) or textphone 0845 608 8551 for people with hearing or speech impairments. However, the Helpline will only be able to signpost you to your local authority for housing options advice, or to Jobcentre Plus for help in finding work. They won’t be able to tell you about how much benefit you are getting or how much you will lose.
Check how much benefit you are entitled to now to find out how much Housing Benefit you are likely to lose when the cap is applied next year. This may affect which options you need to consider. An online calculator is available on the Directgov website at www.dwpe-services.direct.gov.uk. You can use this to estimate how much Housing Benefit you will lose if your total benefit income is more than the cap.
Consider whether your circumstances are likely to change after April 2013. For example, do you have a child who will soon be treated as financially independent of you? When this happens, your benefits may go down, which may bring you under the limit of the cap or mean that you are less affected by the cap.
On the other hand if, for example, you’re expecting a baby, your benefits may go up. This could push you over the limit of the cap.
You may need to consider one of the following options:
- can you or your partner get work, or increase your hours of work, so that you can claim Working Tax Credit? This would mean the cap would not apply to you
- can anybody in your household get one of the benefits that mean that the cap won’t apply to you, or that some of your benefits won’t be counted?
- can you move to cheaper accommodation or negotiate a rent reduction with your landlord?
What you can do if you are capped
- apply for a Discretionary Housing Payment from your council. If you can get one, this may help in the short term to pay your rent, or pay for a deposit or removal expenses to help you move to cheaper accommodation
- if you have a disabled child or a child whose health or development is likely to be damaged because of the reduction in your benefit, contact your council’s Children’s Services Department. They may be able to help with a cash payment or other assistance