The benefit cap
The benefit cap - or household benefit cap - limits the total amount of benefits that an out-of-work family can receive.
How much is the benefit cap?
At the moment the cap is:
- £442.31 a week if you are a couple or a lone parent.
- £296.35 a week if you are a single person.
- £384.62 a week if you are a couple or lone parent.
- £257.69 if you are a single person.
How does the benefit cap work?
Unless you are exempt from the benefit cap, your combined income from certain benefits is capped at a set amount. If you get more than this amount then the extra you receive is deducted from either your housing benefit or any Universal Credit payments you get.
For example, Anita and her partner live outside London and get £115 a week in Jobseeker's Allowance, £171 a week in child tax credit, £140 per week in housing benefit and £47.70 in child benefit. This is a total of £473.70. Because their income will be £89.08 above the £384.62 cap, their housing benefit payments will be cut by £89.08 per week.
Are all families with disabled children exempt from the benefit cap?
You are exempt from the cap if you have a dependent child who gets either DLA or PIP.
If you have a disabled child but have not claimed DLA or PIP for them yet, get advice about making a claim. It does not matter what rate of DLA or PIP your child gets; any award at all will mean that the benefit cap does not apply to you.
Am I exempt if my disabled child stops being treated as my dependent?
You are only exempt if you have a 'dependent' child on DLA or PIP. If a disabled child aged 16 or above either leaves education, turns 20 or claims certain benefits such as Employment and Support Allowance or Universal Credit, they stop being treated as a dependent. This means that their parent may then lose their exemption from the benefit cap.
However, anyone who is getting Carer's Allowance will also be exempt from the cap. This will help protect some parents whose disabled child stops being treated as a dependent. So long as that parent gets Carer's Allowance, they should remain exempt from the cap. You will also be exempt as a carer if you have an underlying entitlement to Carer's Allowance - that is, you have claimed Carer's Allowance and qualify for it but your payments are blocked by another benefit you receive.
In addition, those who get Universal Credit with a carer element should also exempt. These exemptions for carers already apply in Northern Ireland. Contact our freephone helpline if you are a parent of a disabled young person, are receiving one of these carers benefits and you are currently being affected by the cap.
Is anyone else exempt?
You are exempt from the cap if you or your partner is working sufficient hours to be eligible for working tax credit. This is either 16 or 24 hours a week depending on your circumstances.
If you work and get Universal Credit, you are exempt if your earnings are at least £430 in that monthly assessment period. Other groups are also exempt, such as families where a parent gets certain disability benefits.
Special rules have been introduced in Northern Ireland that mean housing benefit claimants get additional 'welfare supplementary payments' to make up any shortfall in their housing benefit because of the benefit cap.
What happens if I lose my job or have to give up work?
If you were working for at least 50 out of the 52 weeks immediately before you started claiming benefits and you either lose your job or give up work through illness, you are allowed a nine month 'grace period' before the cap is applied to your benefit income. You must not have been entitled to Employment and Support Allowance, Jobseeker's Allowance or Income Support during the time you were working.
If you get Universal Credit, and your earnings (including any partner's earnings) drop to below £430, a nine month grace period applies so long as you were earning above that amount in each of the preceding 12 months.
If you stopped work before you claimed Universal Credit, a 9 month 'grace period' applies so long as your earnings had been above £430 per month in each of the preceding 12 months.
What should I do if I am affected by the benefit cap?
Get advice to see if you should be exempt from the benefit cap or could become exempt by changing your situation. For instance, if you have a disabled child but have not yet claimed DLA for them, getting a DLA award will result in you becoming exempt from the cap altogether.
If you cannot become exempt and are a housing benefit claimant, get advice about applying to your local authority for discretionary housing payments.