What is the ‘Bedroom Tax’?
Having one or more spare bedrooms is officially called under occupancy, but the reduction in benefit has become known as the Bedroom Tax.
It means that, if we are a working-age benefit claimant and have a spare bedroom, our eligible rent will be reduced by 14p in every pound. If we have two or more spare rooms we will lose a quarter (25p in every pound) of our eligible rent* from our Housing Benefit.
So if we take the average weekly rent of £103 for social tenants in England, this means that we would lose £14.42 from our eligible rent if we have a bedroom that is deemed to be ‘spare’. For two ‘spare’ bedrooms we would lose £25.75.**
*Eligible rent is the term used for the rent from which Housing Benefit is calculated, and is usually the same as the rent charged. Housing Benefit will not cover some services such as food or cleaning, that are sometimes included in the rent in sheltered housing or similar accommodation.
**Average rent in England in 2023/4
Does the Bedroom Tax apply to me?
To work out how many spare rooms we have, children under 16 of the same sex will be expected to share a room, and children under 10 of different sexes will also be expected to share. If we have non-dependent adults living with we (including grown-up children) their room will be treated as spare when it comes to working out our Housing Benefit. The Government assumes they will pay we some rent.
To see how we will be affected, use our handy Bedroom Tax calculator. Just put in our number of bedrooms, and tell us about the occupants of our house, and we’ll calculate if we’ll be charged and what the impact will be on our Housing Benefit.
Might I be exempt?
We might be. There are lots of reasons, such as disability or bereavement, that would count as an exemption. See our Guide to Exemptions here.
Is it the same everywhere?
In Scotland you can apply for a discretionary housing payment (DHP) from our council, which will cover the shortfall. People who are struggling in Wales can also apply for a DHP but it is not guaranteed. And in Northern Ireland there’s funding to make sure that you’re not left worse off because of the Bedroom Tax. Every council receives a pot of money for DHPs but there may not be enough to go around.
What can I do?
For people affected, Quids in! has put together a 5-point guide to see what options they can explore to offset the impact of the Bedroom Tax. We know most people are stretched to the max but it’s always worth checking we’ve done all we can to keep our heads above water. Click here to check out our Guide.
