How we calculate your Housing Benefit
To calculate how much Housing Benefit you are entitled to, we add together all your earned and unearned income. If you have a partner, we’ll include their income too.
We’ll deduct Income Tax, National Insurance and half of any pension contributions from your gross earnings.
Working out your income if you are employed
If you’re paid monthly, we’ll work out the deductions using the average of two monthly payslips. The average is then converted into a weekly figure.
You’ll need to show us either two monthly payslips, two four-weekly payslips, three fortnightly payslips or five weekly payslips. All payslips must follow on from each other.
If you’ve just started work and don’t have these payslips, you can provide:
- one payslip
- your contract of employment
- a letter from your employer confirming the number of hours you are due to work each week and your hourly pay, or the number of hours you are due to work each week and your annual salary
- a Certificate of Earned Income form which must be completed and stamped by your employer
You will still need to provide the payslips listed above once you have received them.
Working out your income if you are self-employed
If you’re self-employed, we’ll need to see your accounts. They should be for a recent trading period, for example the most recent financial year, or the last six to 12 months.
You’ll also need to supply evidence of your income and expenses by providing invoices and receipts for the relevant trading period.
We will work out your profit for the trading period and make the deductions. The remaining profit is then converted into a weekly figure.
If you have just started self-employment you can:
- provide a self-employed account for the last three months with proof of income and expenses
- provide a projected self-employed account for three months from the start of your self-employment
If you receive other welfare benefits they will be added to your claim and no amounts will be deducted. You will need to provide recent letters from the relevant departments confirming the benefits you receive.
We don’t count some income for the calculation of Housing Benefit, for example Child Benefit, Disability Living Allowance and 25% of money received from an ex-partner towards child maintenance.
We ignore a small amount from your earnings if you are working. This will depend on who is in your household and the number of weekly hours worked by you and/or your partner.
We calculate Housing Benefit using an applicable amount, which is the amount of money the government believes you (and your partner) need to meet your necessary weekly costs. The amount depends on the size and circumstances of your family.
We take your applicable amount away from your total weekly income, and any remaining income is known as your excess income.
To work out your applicable amounts we add up:
- your personal allowance
- personal allowance for any children you have
- any family or disability premium
Things that can affect the amount of Housing Benefit you receive
We treat student loans, grants and bursaries as income for Housing Benefit purposes. Find out about student income and Housing Benefit.
Some childcare costs are not counted when we are working our your entitlement. Find out more about how childcare costs are calculated for Housing Benefit.
Capital – investments, properties and savings
Capital is anything that has a monetary value, such as land and property, investments and savings. Find out how capital can affect Housing Benefit entitlement.
Eligible rent is the maximum amount of Housing Benefit we can pay you regardless of how much your rent is. Find out about eligible rent.
Your bedroom requirement is the amount of bedrooms you need based on Housing Benefit regulations and the people living in your house. Find out about bedroom requirements.
A non-dependant is someone who normally lives with you such as an adult child, relative or friend and is not liable to pay Council Tax. Find out how non-dependants affect your Housing Benefit entitlement calculation.
The benefit cap limits the amount of certain benefits you can get if you are under state pension age and you receive Housing Benefit. Find out about the benefits cap.
Your claim for Housing Benefit can be backdated for one month from the date of your form if you have a good reason for not applying sooner.