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Local Housing Allowance

Local Housing Allowance

Local Housing Allowance is the way of working out Housing Benefit for tenants who rent their homes from a private landlord. Since 07 April 2008 Housing Benefit is calculated using the Local Housing Allowance (LHA) when people make a new application for Housing Benefit, change address or room, or have a break in their claim on or after the 7 April 2008.

 

Calculating your size criteria

Local Housing Allowance refers to different categories of allowance which relate to different sizes of property. We will decide how many rooms, according to the Housing Benefit rules, you will need. Tenants with similar circumstances are entitled to the same category of LHA.

The category that you are entitled to depends on the number of occupiers within your household. One bedroom shall be allowed for each of the following categories of occupier (and each occupier shall come within only the first category which applies to them):

  1. a couple;
  2. a person who is aged 16 or over;
  3. two children of the same sex until they are 16;
  4. two children who are younger than 10 years old;
  5. a child (someone under 16);
  6. Disabled children who cannot be expected to share will be allowed an additional room (from 04.12.2013).

Please note:

The allowances are set by The Rent Service and can be found on their website.

The size criteria will include an additional bedroom if a customer or their partner has a need for overnight care that is provided by a non-resident carer. If you receive Disability Living Allowance at the middle or high rate and have a non-resident carer providing care on a 24-hour per day basis, you should contact us to check if you qualify for additional help with your rent.

The law has now been changed to allow for an extra bedroom where a disabled child, who would normally be expected to share, is unable to do so as a result of their disability.

Disabled children can be considered for a room of their own if:

  • They are entitled to the highest or middle rate care component of Disability Living Allowance (DLA);

  • Their local authority is also satisfied that sharting a bedroom would pose either a risk of physical harm or cause frequent and significant disruption to either the disabled child or the child with whom they would normally be expected to share.

From 01 April 2013 the rate will be fixed for 1 year and reviewed annually in April. The claim is based on the rate at the time the claim is made and will be reviewed each April, unless there's a change in circumstances. See the Valuations Office Agency's website for further information.

 

The rates for 01 April 2014 to 31 March 2015 are:
Household entitlement     Weekly     Monthly
A: One bedroom, shared accomodation level   £64.83   £280.93
B: One bedroom, self-contained level   £122.36   £530.23
C: Two bedroom level   £151.50   £656.50
D: Three bedroom level   £186.92   £809.99
E: Four bedroom level   £252.69   £1094.99

 

Please note:

  • Category A: One bedroom, shared accomodation will be based on properties where a tenant has the exclusive use of only one bedroom and where the tenancy provides for him / her to share the use of one or more of:

    • a kitchen
    • a bathroom
    • a toilet, or
    • a room suitable for living in.
  • If you are single and aged under 35, generally the appropriate rate is Category A: One bedroom, shared accomodation.
  • If you are single and aged over 35, you may be entitled to the Category B: One bedroom, self-contained rate if you have exclusive use of 2 ‘living’ rooms - such as a bedroom and your own lounge, or 2 bedrooms - even if you share a bathroom and / or kitchen.

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Aims of the LHA

Central Government has stated that there are a number of key aims for the LHA such as:

  • Fairness in terms of tenants with similar circumstances living in the same area will get the same amount of Housing Benefit
  • Choice in terms of tenants being able to choose the quality and price of their accommodation with the possibility of keeping up to £15 pw to spend on other items
  • Transparency in terms of the scheme making it easy to find out how much rent could be covered by Housing Benefit
  • Personal responsibility: by paying the allowance to the tenant encourages 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 the complex rent restrictions, this should speed up the decision making process.

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Exempt Tenancies

Only a few tenancies will be exempt, such as:

  • if you are a private tenant who has claimed Housing Benefit without a break for the same home since before 7 April 2008
  • Live in a caravan, mobile home, site rents, and house-boats (including mooring charges)
  • The rent officer judges that a substantial part of your rent is attributable to Board and Attendance e.g. hotel accommodation;

The rules for these types of tenancies can be found here.

Other claims are paid under Local Housing Allowance (LHA) rules. 

 Registered Social Landlord tenancies

  • Protected cases, such as supported housing provided by certain local authorities, social landlords, charities and voluntary organisations;
  • Tenancies that are excluded from current rent restrictions, such as:
  • Local Authority tenancies;
  • Regulated tenancies prior to 15 January 1989;
  • Other regulated tenancies (Rent Act 1977) or Rent (Agricultural) Act 1976;
  • Home Office bail hostels or probation hostels
  • HAT lets (Housing Action Trust);
  • Former LA tenancies now transferred unless rent has been increased and felt to be unreasonable;

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How much will I receive?

You will receive Local Housing Allowance based on:

  • The number of occupiers in your property; and
  • the area in which you live.

Entitlement to the Local Housing Allowance will be subject to a means-test and proof of a valid tenancy, just as it is with Housing Benefit now.

The LHA rate used in the assessment remains in effect for 1 year and will not be changed if your rent increases.

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Broad Rental Market Areas (BRMA)

A BRMA, or 'Locality', is an area made up of two or more distinct areas of residential accomodation within which a person could reasonably be expected to live, having regard to facilities and services for the purpose of health, education, recreation, personal banking and shopping, and containing residential premises of a variety of types.

All properties within the Borough of Poole fall within the Bournemouth Locality. The Rent Service website provides a map and search-by-postcode facility for determining the appropriate Locality.

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Payments

Local Housing Allowance payments will normally be made directly to your bank account, rather than to your landlord. You will be responsible for making payment to your landlord. If you do not pay your rent, your home could be at risk.The Borough of Poole and other Local Authorities will have discretion to make payments to the landlord in exceptional circumstances (see 'Safeguards for tenants and landlords' below). 

If you do not already have a bank account, Dorset Local Authorities have been in touch with local banks and building societies and can help. Advice on 'basic bank accounts' can be found here. Further assistance on setting up a bank account can be obtained from welfare organisations such as the Citizen's Advice Bureau.

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Safeguards for tenants and landlords

The biggest change for most landlords is that Local Housing Allowance payments will be made to the tenant. The tenant will be responsible for paying their rent to the landlord.

In recognition of the risk that some tenants may struggle with the responsibility of paying their rent, a 'Safeguard Policy' has been jointly adopted by all eight Dorset Local Authorities to protect vulnerable tenants or landlords of tenants that are unlikely to pay. Several Landlord and Advisor forums have been held to offer interested parties an opportunity to discuss a draft of the policy and to suggest changes or improvements.

Rather than introduce a precise list of circumstances when payment could be made to the landlord, we have been given discretion in identifying such cases where direct to landlord payments would be more effective. We shall be able to decide to make payment direct to a landlord in a number of circumstances including:

  • if we consider that the tenant is likely to have difficulty managing their own affairs. We have called this 'vulnerability'. Examples of this could include tenants with a learning disorder or a drug or alcohol problem that would mean they may have problems managing a budget. Advice regarding 'vulnerable' tenants can be found in the 'Safeguard' policy;
  • if we think the tenant is unlikely to use their Local Housing Allowance to pay their rent. This could be if we know the tenant has consistently failed to pay their rent in the past;
  • when the Local Housing Allowance has been backdated or there has been a delay in processing a claim and a large amount of benefit is to be paid. In these cases we can decide to make the first payment of Local Housing Allowance by cheque payable to the landlord, although it would be sent to the claimant (This is the same as Housing Benefit Regulation 94). Making the first payment direct to the landlord is also expected to provide a good indication that the tenancy has actually been established;
  • if the tenant has built up rent arrears of eight weeks or more and payment direct to the landlord has been implemented (under current Housing Benefit regulations), we can decide to continue making payments direct to the landlord after the arrears have fallen below eight weeks;
  • If the tenant is having deductions from their Income Support or Jobseeker's Allowance to pay off rent arrears we must pay the landlord.

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Further Information

Follow this link for the presentation of October 2007 held for private landlords, Citizen's Advice Bureau, Welfare agencies, and Housing Officers. The questions that were asked on the day, and the responses, can be found here 

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Contact us

Email
financialservices@poole.g
ov.uk

Telephone
01202 634234

Text Relay
18001 01202 634234

Address
Financial Services
Civic Centre
Poole
BH15 2RU