Benefit cap

The benefit cap is a central government limit on the total amount of certain benefits working age households can receive before any deductions are taken.

Who the benefit cap applies to

How the benefit cap will affect you

Benefits that do count towards the benefit cap

Benefits that do not count towards the benefit cap

What you should do now

Options to deal with the benefit cap

If you are affected by the benefit gap

Useful contacts

Who the benefit cap applies to

The government’s benefit cap will not apply to you if you or your partner qualifies for Working Tax Credit (even if you don’t actually receive it because your income is too high), or if anyone in your household is entitled to any of the following benefits:

  • Adult Disability Payment (ADP)
  • Armed Forces Compensation Scheme
  • Armed Forces Independence Payment
  • Attendance Allowance
  • Carer’s Allowance
  • Carer Support Payment
  • Child Disability Payment
  • Disability Living Allowance (DLA)
  • Employment and Support Allowance (if you get the support component)
  • Guardian’s Allowance
  • Industrial Injuries Benefits (and equivalent payments as part of a War Disablement Pension or the Armed Forces Compensation Scheme)
  • Personal Independence Payment (PIP)
  • War pensions
  • War Widow’s or War Widower’s Pension
  • If you are in a care home or in hospital, and this is the reason you don’t receive one of the above benefits

If you have been previously employed for 52 weeks or more and were eligible for Working Tax Credits (even if you were not receiving it because your income was too high, you will be exempt from the Benefit Cap for a grace period of up to 39 weeks if you claim Housing Benefit or Universal Credit.

Pensioners are not affected by the benefit cap.

How the benefit cap will affect you

If your total benefit payments exceed the government’s benefit cap below, the extra amount will be deducted from either your Housing Benefit payments (whether the Housing Benefit is paid to your landlord or you) or your Universal Credit payments.  

Since April 2023 the Benefit Cap has been:

  • £423.46 a week (£1,835 a month) if you’re a couple – with or without dependent children
  • £423.46 a week (£1,835 a month) if you’re a lone parent with dependent children
  • £283.71 a week (£1,229.42 a month) if you’re a single person without children

You will need to make up any shortfall to your landlord.

Your household includes you, your partner and any children you are responsible for and who live with you. The income of any non-dependents living with you (such as adult children) does not count.

For example, currently: 

A couple with children or a single parent currently receiving £220 per week Housing Benefit, £120 per week Child Tax Credit and £34 per week Child Benefit and £114 per week in ESA would have a total income of £488 per week.

They would have £103.38 per week deducted from their Housing Benefit or Universal Credit entitlement, as this is the amount they are over the benefit cap.

They would have to make up the difference to their landlord.

Benefits that do count towards the benefit cap

The benefit cap will apply to your combined entitlement from:

  • Universal Credit
  • Bereavement Allowance
  • Child Benefit
  • Child Tax Credit
  • Employment and Support Allowance
  • Housing Benefit
  • Incapacity Benefit
  • Income Support
  • Jobseeker’s Allowance
  • Maternity Allowance
  • Severe Disablement Allowance
  • Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widow’s Pension if you started getting it before 9 April 2001)

Benefits that do not count towards the benefit cap

The following benefits are no included when working out whether your total benefit income is more than the benefit cap:

  • Council Tax Reduction
  • Pension Credit
  • One off payments made by your local authority to help you out in a crisis
  • Statutory Sick Pay, Statutory Maternity Pay, Paternity Pay or Adoption Pay
  • Winter Fuel and Cold Weather Payments
  • State Pension
  • Non-cash benefits, for example, free school meals
  • A short term advance from the DWP to help you out over a crisis until your first benefit payment

What you should do now

  • Work out how much could be deducted from your Housing Benefit/Universal Credit. There is an online benefit calculator.
  • If you still have questions contact us on 0118 937 3707 or one of the other agencies listed below.

Options to deal with benefit cap

  • If you are receiving Child Tax Credit and Housing Benefit, can you or your partner find paid work, or increase your hours of work to qualify for Working Tax Credit? (even if you don’t actually receive it because your income is too high)
    • If you are single with one or more children, you would need to work at least 16 hours/week.
    • If you are a couple with one or more children, you would usually need to work at least 24 hours/week between you (with one of you working at least 16 hours/week)
  • If you are receiving Universal Credit, can you or your partner find paid work, or increase your hours of work?
    • You/you and your partner need to earn £793 per month or more to not be affected by the benefit cap. This amount is what you would earn if you worked 16 hours a week receiving the minimum wage for someone 25 years and older (even if you are under 25). This amount changes as the minimum wage changes. 
  • Can anyone in your household get one of the benefits that means the Benefit Cap won’t apply to you, or that some of your benefits won’t be counted?
    • If you believe that you or your partner can get PIP (Personal Independence Payment) then please call 0800 917 2222 to apply. Alternatively, if you have a child under 16 that you believe will qualify for Disability Living Allowance please call 0800 121 4600.
  • Can you move to cheaper accommodation or if you’re a private tenant, you may be able to negotiate a rent reduction with your landlord?
  • Find out if you can receive regular payments from voluntary sources (friends, family or from charities). These payments won’t affect your benefits.

If you are affected by the benefit cap

Check if you can get Discretionary Housing Payments (DHP).  This may help cover a short-term need if your circumstances are likely to change shortly after the benefit cap is applied. Find out more about applying for a Discretionary Housing Payment or contact the Debt Advice Team on 0118 937 2197 to request an application form is posted to you.

Manage your spending, you can review your spending and cut back on any unnecessary outgoings. If you really cannot manage, it may mean you will need to move to a cheaper property.

Contact our Debt Advice Team who can provide basic budgeting advice, or book you in for an appointment for more in depth advice. 

Information on a range of money matters.

Find out if you can get any help from a charity. You can get information about how charities can help from the Turn2us website.

Useful contacts

Last updated on 04/06/2024