The Under Occupancy Penalty restricts the amount of Housing Benefit or Universal Credit housing association tenants can claim if they have spare bedrooms in their home. 

If you are affected by under occupancy then you should contact us. We can help you check whether you are claiming all the benefits you are entitled to. We can also look to see if there are any properties which would be more suited to your needs.

How does under occupancy work?

The amount of housing benefit or Universal Credit you can claim for rent is lowered by:

  • 14% if you have one spare bedroom
  • 25% if you have two spare bedrooms

How many bedrooms can I get housing benefit for?

The amount of bedrooms you can claim housing benefit for is as follows:

  • A couple = one bedroom
  • An individual aged 16 or over = one bedroom
  • Two children of the same sex under the age of 16 = one bedroom
  • Two children under the age of 10 (regardless of sex) = one bedroom
  • An additional child = one bedroom
  • An overnight carer for you or your partner = one bedroom

A child is usually counted as living in the home of the person who receives their child benefit.

How it works:

John and his wife Sue have two children; Ben (aged nine) and Helen (aged seven) – this means they can claim Housing Benefit for two bedrooms.

John and Sue live in a three bedroom house. Before the new under occupancy rules came in they had claimed £100 housing benefit per week but under the new rules they will now get £14 per week less.

Once Ben reaches age 10 they will be able to claim housing benefit for three bedrooms again.

Is everyone affected?

Not everyone is affected by under occupancy.

  • If you or your partner have reached state pension credit age you do not have to pay
  • One extra room is allowed for approved foster carers who foster a child or children
  • Students who are away from home but are away for less than a year are classed as living at home
  • A disabled child who needs his own room isn’t required to share
  • Someone who is in the armed forces who is serving away is considered to be living at home.

What changes when I am switched to Universal Credit?

Universal Credit is replacing other benefits and people are being gradually switched over to the new system. There will be even more changes you need to know about when this happens.

  Housing Benefit Universal Credit
Students Parents are not penalised if a student lives away at university  Once moved over to Universal Credit, a student will need to be at home for at least six months a year or the benefits will be cut
Pensioners If you have reached State Pension Credit Age; including where one member of a couple is over then you are not affected If you are a couple then both of you will need to be over State Pension Credit Age (if you are already in receipt of Pension Credit when the switch to Universal Credit is made then you’ll be unaffected)
Lodgers A claimant of housing benefit with a lodger is allowed to keep the first £20 of weekly rent Housing benefit will be cut but tenants can keep up all rental income (up to £4,250) of the rent is income tax free

 

Universal Credit could also affect any other benefits you claim and the way that your benefits are paid. It is important to know how Universal Credit will affect you.

What should I do if I am affected?

If you are affected by under occupancy then you should contact us.

We can help you check to see whether you are claiming all the benefits you are entitled to. We can also look to see if there are any properties which would be more suited to your needs.

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