The Benefit Cap

The Benefit Cap limits the overall amount of welfare benefits a ‘working age’ household can receive.

If you (or you and your partner) are affected it is worth checking to see if you can claim one of the benefits that will exclude you from the Cap.

Go to the ‘Benefit Cap’ page to find out more, and discover if there is anything else you can do if you are affected by the Cap.

• Benefit Cap for people on Housing Benefit

  Who won’t be affected by the Cap?

  The Benefit Cap does not apply to you if:If you, your partner, or a child or young person for whom you get Child Benefit, gets Disability Living Allowance, Personal Independence Payment or Armed Forces Independent Payment.

  • You or your partner are Pension Credit Age (unless you are getting Universal Credit, Income Based JSA or Income Support or Income Related ESA or ‘working age’ Housing Benefit)

  • You or your partner have claimed and are entitled to claim, Working Tax Credit

  • You, your partner, or a child or young person for whom you get Child Benefit, gets Disability Living Allowance, Personal Independence Payment or Armed Forces Independent Payment.

  • You or your partner are in the ‘support group’ of Employment Support Allowance.

  • You or your partner receive (or have an underlying entitlement to) Carer’s Allowance

  • You or your partner receive Guardian’s Allowance

  • You or your partner get Industrial Injuries Disablement Benefit.

  • You or your partner get a War Disablement Pension, Armed Forces Compensation Scheme payment, or a War Widows’/Widowers’ Pension

  • You (or you and your partner) are out of work but had been in work for at least 50 out of the 52 weeks before – this “grace period” lasts 9 months.

  How do you work out if the Cap applies to you? 

  If you are of working age and not getting one of the benefits / in one of the situations that would exclude you from the Benefit Cap then the DWP will add together most of the benefits you are entitled to (including Child Benefit).

  They will then compare this to the Benefit Cap limit that applies to you:

  Inside Greater London

  £442.31 per week for single parents.
  £442.31 per week for couples with or without children.
  £296.35 per week for single people without children.

  Outside Greater London

  £384.62 per week for single parents.
  £384.62 per week for couples with or without children.
  £257.69 per week for single people without children.

  If your total welfare is above this Cap limit you will be affected by the Benefit Cap.

  When you add the benefits together do not include: Council Tax Support, Statutory Sick Pay, Statutory Maternity Pay, Bereavement Support Payment, Discretionary Housing Payments and Housing Benefit paid on ‘specified accommodation’ (ie certain supported housing – ask us if you’re not sure if this applies to you).

  If the total amount of the benefits you (and your partner) are entitled to comes to more than the Benefit Cap limit your Housing Benefit payments will be reduced. If this would mean losing all your Housing Benefit, you still have to be given 50p a week. This means that you can still try for a Discretionary Housing Payment.

  It is only your Housing Benefit that can be reduced due to the Cap – although 50p a week must be left in payment. 

  IMPORTANT: If you are currently affected by the Benefit Cap and receive just 50p a week in Housing Benefit you could be worse off on Universal Credit. So if you are told to claim UC get advice first!

  Example: (Example for Outside Greater London areas)
  
  Julie and Nick have three children age 11, 8 and 4. Nick is currently unable to work following a car accident that has left him with back and leg injuries. They pay £100 per week rent for their 3 bedroom house.

  They are claiming the following benefits:
  
  Child Benefit                  £ 48.10  per week
  Child Tax Credit            £170.87 per week
  Income Related ESA  £143.90 per week
  Housing Benefit           £100.00 per week
  
  Total “welfare”             £462.87 per week.

  The Benefit Cap limit which applies to them is £384.62 per week.

  Their ‘excess’ income is £78.25 (£462.87 minus £384.62 = £78.25).

  So their Housing Benefit will be reduced by £78.25 – they will receive £21.75 per week. They will have to pay the remainder of their rent out of their other benefits.
  
  For the government’s Benefit Cap calculator go to this link: https://www.gov.uk/benefit-cap-calculator.

• Benefit Cap for people on Universal Credit

  Who won’t be affected by the Cap?

  The Benefit Cap does not apply to you:

  • In any months in which you or your partner have earned income of £520 or more.
  • If you, your partner, or a child or young person for whom you get Child Benefit, gets Disability Living Allowance, Personal Independence Payment or Armed Forces Independent Payment.
  • You or your partner are regarded as “having a limited capability for work-related activity”.
    You or your partner get Industrial Injuries Disablement Benefit.
  • You or your partner get a War Disablement Pension, Armed Forces Compensation Scheme payment, or a War Widows’/Widowers’ Pension.
  • If you are entitled to Carer’s Allowance or a Carer Element in your Universal Credit award
  • If you get Guardian’s Allowance
  • If you (or you and your partner) are out of work but had been in work continuously for over 12 months before losing the job and you or your partner (or if you were both working, between the two of you) have earned at least, £520 or more in any monthly assessment periods which started on or after 1st April 2017 onwards – you will be protected for a “grace period” of 9 months.

  How do you work out if the Cap applies?

  If you are not getting one of the benefits / in one of the situations that would exclude you from the Benefit Cap then the DWP will add together most of the benefits you are entitled to (including Child Benefit).

  They will then compare this to the Benefit Cap limit that applies to you:

  Inside Greater London:
  £1916.67 per month for single parents.
  £1916.67 per month for couples with or without children.
  £1284.17 per month for single people without children.
  
  Outside Greater London:
  £1666.67 per month for single parents.
  £1666.67 per month for couples with or without children.
  £1116.67 per month for single people without children.
  
  If your total welfare is above this Cap limit you will be affected by the Benefit Cap.

  When you add the benefits together do not include: any Child Care Cost Element of the Universal Credit award, Council Tax Support, Statutory Sick Pay, Statutory Maternity Pay, Bereavement Support Payment, Discretionary Housing Payments and Housing Benefit paid on ‘specified accommodation’ (ie certain supported housing – ask us of you’re not sure if this applies to you).
  
  If the total amount of the benefits – including any Universal Credit - you (and your partner) are entitled to   is more than the Benefit Cap limit that applies in any monthly assessment period then your Universal Credit payments will be reduced for that month. If you are struggling to pay your rent because of the Cap then you might be able to get a Discretionary Housing Payment to help you.

  IMPORTANT: If you are currently affected by the Benefit Cap and receive just 50p a week in Housing Benefit you could be worse off on Universal Credit. So if you are told to claim UC get advice first!

  Example:

  Mahia and Para have 6 children aged 17, 14, 10, 7 and twins aged 3. They have had difficulty finding work, and their rent is £128.00 per week (which works out at £554.67 per month).

  They are entitled to:

  Child Benefit       £  386.53 per month
  Universal Credit   £2488.99 per month

  Total “welfare”    £2875.52 per month

  As their total welfare income is £1208.85 over their Benefit Cap of £1666.67 per month, their Universal Credit will be reduced by £1208.85 to £1280.14, so they will need to pay for their rent, food, bills etc. out of their reduced Universal Credit and their Child Benefit.

  For the government’s Benefit Cap calculator go to this link: https://www.gov.uk/benefit-cap-calculator