Housing benefit and council tax reduction explained

Housing benefit and council tax reduction are state benefits that help people on a low income to pay their rent and council tax.

Both benefits are means-tested – what does this mean?

We look at you and your partner’s:

  • income
  • savings and investments
  • personal circumstances of other adults living in your household

The Government decide an amount that they believe is the minimum that you and your family need to live on each week. This is called your applicable amount. Once your income goes above your applicable amount then you will start to lose benefit.

You can claim

  • housing benefit if you are over pension credit age and paying rent on your home. Working age households should claim Universal Credit from the DWP
  • council tax reduction if you are the person paying the council tax on your home or if you are a homeowner

You can’t claim

  • housing benefit and council tax reduction if you have more than £16,000 in total savings, stocks and shares or other capital, unless you receive guarantee pension credit. Any savings over £6,000 will affect the way your claim is calculated dependent on whether you are under or pension credit age
  • housing benefit if you make mortgage payments for your home
    • however, if you are having problems paying your mortgage the Department for Work and Pensions may be able to help, tel 0845 600 6334
    • you will still be able to claim council tax reduction if you are liable to pay the council tax

Some other groups of people do not qualify for benefit such as most full-time students or asylum seekers.

Calculate your benefit and make a claim

Start a new calculation / claim  Return to a saved calculation / claim

The calculator will only give you an estimate of your potential benefit. An accurate decision can only be made after we have received your application and documentation.

For support applying online please tel 020 8356 3399.

How is council tax reduction worked out?

Working-age people

  • your council tax reduction will be limited to a maximum of 85% of your council tax bill before any deductions due to income and savings
  • your eligible council tax will be reduced if you (and your partner) have other adults living with you (non-dependent deductions). This is because they are expected to help pay the costs

Pensioners

Pensioners are protected and continue to receive the same level of support that they did under the old council tax benefit system.

You are classed as a pensioner if you have reached the qualifying age for pension credit or if you are a couple and one of you has reached the qualifying age for pension credit.

However, you will not be classed a pensioner if one of you receives:

  • income support
  • income based jobseekers allowance, or
  • employment support allowance (income related benefit)

More information

Additional help if you are still struggling with rent and council tax

If you are already receiving housing benefit and or council tax reduction but are still having difficulty paying your rent or council tax, you may be able to apply for a short-term discretionary payment.

You can apply if you need further financial assistance with your council tax and/or housing costs. All awards are discretionary and will be considered based on your circumstances. There are 2 discretionary payment schemes:

  • the council tax reduction discretionary hardship scheme, can help with your council tax costs. To qualify you must be entitled to council tax reduction and have a shortfall between your council tax reduction and your liability
  • discretionary housing payments can help with your housing costs. To qualify you must be entitled to housing benefit (HB) or universal credit (UC) that includes a housing element towards rental liability

Text message and email trial

To help prevent debt, we’ve recently started a trial to send additional text messages and emails to remind customers about paying their council tax, which have a different look to the usual ones sent by us.

The trial will cover a small percentage of customers (mainly those in receipt of council tax reduction). If you’re concerned that a new message you’ve received isn’t genuine, you can contact the council tax team on 020 8356 3154, to confirm the message is genuine.

Page updated on: 29 April 2021

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