Local Housing Allowance Rates
Local Housing Allowance (LHA) is the way we work out housing benefit for tenants who rent their homes from a private landlord.
Central Government has stated that there are a number of key aims for the Local Housing Allowance such as:
- Fairness – tenants with similar circumstances living in the same area will get the same amount of housing benefit
- Choice – tenants being able to choose the quality and price of their accommodation
- Transparency – making it easy to find out how much rent could be covered by housing benefit
- Personal responsibility – by paying the allowance to the tenant we encourage them to take responsibility for budgeting and paying their rent themselves
- Increased work incentives – greater certainty about what in-work benefit they could receive is expected to help tenants to bridge the gap between being out of work and taking a job
- Simplicity – by removing complex rent restrictions, we speed up the decision making process.
LHA rates from 1st April 2020 – 31st March 2021 will be:
Shared Room Rate
One Bedroom Rate
Two Bedroom Rate
Three Bedroom Rate
Four Bedroom Rate
Who is exempt from the LHA rules?
You are exempt from the LHA rules if:
- You are a housing association tenant
- You have a tenancy that started before 1989
- You live in/on a caravan, hostel or houseboat
- You live in board and lodgings
- You live somewhere where your landlord provides care, support or supervision.
If you fall in to any of the above categories you can still claim housing benefit.
How will my rate of LHA be calculated?
The rate of LHA that applies to you and your household depends on:
- Who lives with you and the number of bedrooms your family needs
- The area you live in.
The LHA rates vary depending on the size of the property. These rates are set by an independent rent officer and are based on local rents. You may get less than the maximum rate depending on your circumstances.
Knowing the amount of LHA will let you work out the maximum housing benefit you might qualify for when looking for somewhere to live. You can then choose a place that suits you.
How many bedrooms do I need?
The number of bedrooms you need depends on how many people live with you. You are allowed one bedroom for:
- A couple
- Any other adult aged 16 or over
- Any two children of the same gender aged under 16
- Any two children aged under 10
- Any other child.
The rate of LHA for single people under 35 will be based on a room in shared accommodation, such as a bed sit or a room in a property where kitchen and bathroom facilities are shared with other tenants.
Example 1: Mary and John are a couple who have a child, Jack, who is nine years old. They are entitled to one bedroom for themselves and one bedroom for Jack. This means any housing benefit they are entitled to will be based on the Local Housing Allowance rate for two bedrooms.
Example 2: Sharon is a single mother who has three children. Tom, who is fourteen, Chloe who is eleven and Connor who is six. Sharon is entitled to one bedroom for herself, one bedroom for Chloe and one bedroom for Tom and Connor to share. This means any housing benefit she is entitled to will be based on the Local Housing Allowance rate for three bedrooms.
How is housing benefit paid under the LHA rules?
You will usually get the housing benefit paid to you and it is up to you to pay your landlord. It must be paid into a bank or building society account and will be paid every four weeks in arrears.
As a tenant you are responsible for paying your rent to your landlord. It is important that you pay your rent on time to avoid losing your home. If you do not pay the rent your landlord may apply to the council to have your benefit paid directly to them.
I don’t have a bank account. What can I do?
The council and the Government are promoting the use of basic bank accounts for tenants receiving benefit. The use of standing orders and direct debits are an easy and effective way of managing money and mean that you don’t need to wait for a cheque to clear.
Help and advice on opening a bank account.
The Citizen’s Advice Bureau (CAB) provide money advice to private tenants in receipt of housing benefit and can help with budgeting and advice on managing debt. If you would like to use this service, please phone the CAB for an appointment on 0844 499 4199
Other local advice agencies in your area may also be able to provide you with assistance.
What if I cannot manage to pay the rent myself?
Some tenants may struggle with the responsibility of paying their rent and so safeguards have been put in place to make direct payments to landlords in certain circumstances for vulnerable tenants.
The council has certain discretion in identifying tenants where housing benefit would be best paid directly to the landlord. Examples include:
- If we consider the tenant is likely to have difficulty managing their own affairs. This could include tenants with learning disabilities, in severe debt, or with drug or alcohol problems that would mean they may have difficulty managing a budget
- If we consider the tenant is unlikely to use their housing benefit to pay their rent
- If the tenant has built up rent arrears of 8 weeks or more
- If the tenant is having deductions from their Income Support or Jobseekers Allowance to pay off rent arrears
To implement these safeguards, the Council must have written evidence to ensure the claimant meets the criteria of vulnerability.
What if my rent is higher than the LHA rate?
You may find a property where the rent is higher than the rate of LHA used to calculate your Housing Benefit entitlement. The Council will not pay more than the calculated LHA rate for your circumstances and you will have to pay the difference from any other income you receive. In exceptional circumstances you may be able to get a Discretionary Housing Payment to help pay the difference for a short period of time, but this should not be relied upon.