Benefit Cap

What is the Benefit Cap?

The Benefit Cap limits the amount that a household can receive in benefit.  It applies to those aged 16 to 64. 

The Benefit Cap applies to benefits such as Housing Benefit, Child Benefit, Income Support and Job Seekers allowance. 

See a full list of benefits included in calculating the Benefit Cap here

Watch the video: 

What should I do if I think I may be affected?

If you think you may be affected you can contact our Welfare Reform Team. We are on hand to provide you with a wide range of advice and support.

You must find a way to pay your rent or you are at risk of losing your home, you may be able to do this by:

• Paying the shortfall in your rent from other income you have
• Maximising your income by finding employment that will qualify you for Working Tax Credit so that you are no longer affected
• Applying money management techniques to your income and expenditure
• Moving to cheaper accommodation

How is the Benefit Cap calculated? 

The Department for Work and Pensions (DWP) works out which households will be affected by the Benefit Cap. 

Where a household is receiving more benefit than the limit the Housing Benefit will be reduced to bring the total amount of benefit payments in line with the Cap. 

From November 2016, the following amounts are what benefit payments are limited to per week: 

• For a family the maximum amount in benefit payments that can be issued per week is £384.62
• For a single person with no children the maximum amount in benefit payments that can be issued per week is £257.69

For example:

Megan, aged 38, is a single parent with three children. Her weekly income is:

• Income Support - £73.10
• Child Tax Credit - £170.92
• Child Benefit - £48.10
• Housing Benefit - £118.26

This gives a weekly total of £410.38. As Megan does not work and she is not in receipt of a benefit that exempts her, her Housing Benefit will be reduced by £25.76 a week so that her total benefit does not add up to more than £384.62 a week.

To find out how much your benefits may be capped you can use the Benefit Cap calculator here.

Are there any exemptions from the Benefit Cap?

The Benefit Cap will not apply if anyone in your household qualifies for Working Tax Credit. 

There are other benefits that qualify the household for an exemption, the full list is:

• Armed Forces Compensation Scheme
• Armed Forces Independence Payment
• Attendance Allowance
• Carer's Allowance
• Disability Living Allowance (DLA)
• Employment and Support Allowance ('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)
• Universal Credit payment for 'limited capability for work and work-related activity'
• War pensions
• War Widow's or War Widower's Pension
• Working Tax Credit

More information

To find out how much your benefits may be capped you can use the Benefit Cap calculator here. 

Reed in Partnership provide back to work support. You can find further information on their website.