How Local Housing Allowance is calculated

Local housing allowance amount is based on the area in which claimants live and the size of dwelling appropriate for claimant’s household.

This content applies to England

LHA rates

LHA rates are based on the:[1]

  • 'broad market rental area' in which the claimant lives

  • 'category of dwelling' deemed appropriate for their household (ie size criteria)

The information on this page relates to housing benefit. Local housing allowance rates are also used to determine the amount of universal credit housing costs that private renters are entitled to. Some of the rules on size related criteria for universal credit are different, for example on the shared accommodation rate.

Eligible rent under LHA scheme

Housing benefit is calculated by reference to a claimant's eligible rent. Under the LHA scheme the eligible rent is equal to the flat-rate LHA that applies to the claimant.[2]

A claimant cannot receive more in housing benefit than their actual rent, even if their actual rent is less than the applicable LHA rate.

There is also a cap on the amount of benefits that a working-age claimant and their household can receive. A claimant's housing benefit will be reduced to ensure that the total amount of benefits they receive is not more than the benefit cap level.

Broad rental market areas

Each local authority area is divided into a number of distinct broad rental market areas (BRMAs). A BRMA consists of two or more distinct areas of residential accommodation, within which a person could reasonably be expected to live, containing accommodation of different types and various tenancies.[3]

The local rent officer is required to define each BRMA. Once defined, the BRMA will apply to all properties falling within that area.[4] A unified definition of BRMAs applies in respect of both LHA and local reference rent cases (which had previously been determined by reference to rents in a 'locality').[5]

Size criteria

Once the BRMA has been defined, the rent officer determines LHA rates for different categories of dwelling in that area.

Depending on the composition of the claimant's household a particular size of dwelling will be deemed appropriate.

Bedroom rules: general

The criteria used to calculate the size of property that a household requires is that there must be one bedroom for each:[6]

  • adult couple

  • other adult aged 16 or over, this could include a resident carer, lodger or child who is in the Armed Forces

  • child who cannot share a bedroom due to their disability

  • two children of the same sex

  • two children regardless of sex under the age of 10

  • other child

  • (from 1 April 2017) member of a couple that is unable to share a bedroom because of a disability 

A bedroom for a disabled person who cannot share will only be awarded where there is an additional room in the home available for her/him to use as a bedroom.

A room used for the storage of medical or special equipment is not to be counted as a bedroom under the regulations.[7]

See Restrictions on eligible rents for social rented sector tenants for more information about the definition of a bedroom, and about any connection that there must be between a bedroom and the class of person actually expected to occupy it.

Joint tenants who are not members of the same household qualify for a bedroom each. However, the shared accommodation rate may apply. Guidance on specific issues relating to joint tenants has been issued.[8]

The LHA bedroom calculator can be used to work out the number of bedrooms a household is entitled to.

Additional bedroom rules

An additional bedroom is allowed for a:[9]

  • foster child 

  • a non-resident carer who provides overnight care 

Where both categories apply, two additional bedrooms are allowed.[10]

There must be a 'spare bedroom' in the home in order for an additional bedroom to be allowed.[11]

Child in the Armed Forces

A bedroom is allowed if the claimant, or their partner, has a child or step-child who is in the Armed Forces and:[12]

  • is away 'on operations'. This does not necessarily mean on duty outside the UK, it also covers pre-deployment training and post-operation leave (ie 'normalisation')

  • had been a non-dependant when living at home

  • intends to return to the claimant's home

Foster children

An additional bedroom is allowed if the claimant or their partner is an approved foster carer, and they either:[13]

  • have a foster child living with them

  • are between placements and have fostered a child in the last 12 months

  • became an approved foster carer in the last 12 months

Only one extra bedroom is permitted regardless of the number (or sex) of foster children in the claimant's household.

Carers

A bedroom for a resident overnight carer living in the claimant’s home is allowed under the general rules.

An additional bedroom for a non-resident overnight carer should be allowed when it is 'reasonably required' by a:[14]

  • disabled claimant or their disabled cohabiting partner

  • (from 1 April 2017) disabled child

  • (from 1 April 2017) disabled non-dependant adult

A bedroom will be 'reasonably required' if the non-resident carer 'regularly' stays overnight (this might be when care is provided by a team of carers).[15] Whether the bedroom is 'regularly' used is to be assessed over a long period and it is not necessary that a carer stays overnight on the majority of nights.[16]

Disabled persons

In order to qualify for a bedroom on the grounds of needing a non-resident carer or not being able to share a bedroom, the disabled person must be in receipt of one or more of:[17]

  • care component of DLA at the higher or middle rate

  • higher rate attendance allowance

  • daily living component of personal independence payment (PIP)

  • armed forces independence payment

Larger properties

The maximum LHA rate is for a four-bedroom property.[18] This cannot be exceeded even if a claimant:

  • rents a larger property

  • is entitled to more bedrooms under the criteria used to calculate the size of property they require

Discretionary housing payments

A claimant can apply for a discretionary housing payment to help make up a shortfall. The government has made additional funds available, some of which is aimed at disabled people living in accommodation that has been substantially adapted for their needs[19]

Shared accommodation rate

Single claimants aged under 35[20] ie claimants who do not have a partner and are not a lone parent, are only entitled to the rate for a bedroom in shared accommodation, regardless of whether they live in shared accommodation or not, unless they fall within one of the exemptions.[21]

Shared accommodation is where a claimant has the sole use of a bedroom, but shares at least a living room, kitchen or bathroom. This covers individuals sharing a house or flat, as well as bedsits or houses in multiple occupation where a bedroom may include a kitchenette but the bathroom is shared with other tenants in the building.

For housing benefit claims, where a single claimant in fact lives in shared accommodation, the shared accommodation rate applies regardless of age. A single claimant aged 35 and over, or a couple of any age, may be assessed as qualifying for the shared accommodation rate unless they have:[22]

  • exclusive use of at least two rooms (counting only bedrooms and living rooms, and regardless of whether other rooms are shared)

  • exclusive use of one room and a bathroom, toilet, and kitchen (or cooking facilities).

Joint tenants

To have 'exclusive use' of a room means having the legal right to exclude anyone else from the room(s) concerned. This means that joint tenants who are not a couple, and who share facilities, are unlikely to qualify for the one bedroom rate as neither has the legal right to exclude the other from any part of the accommodation.[23] Joint tenants who are not a couple will each qualify for one bedroom at the rate for shared accommodation.

Exemptions from the shared accommodation rate

The exemptions are a claimant who:[24]

  • is aged under 25 and was subject to a care order when aged 16 or 17 (before 31 May 2021 this exemption applied only to claimants under 22)

  • is aged under 25 and was formerly provided with accommodation by social services under section 20 of the Children Act 1989 (before 31 May 2021 this exemption applied only to claimants under 22)

  • receives the severe disability premium (the claimant must get either the daily living component of PIP, DLA care component at the middle or highest rate, or armed forces independence payment, and no one must receive carers allowance or the carers element of UC in respect of the claimant)

  • has a non-dependant living with them

  • is an approved foster carer who either has a child placed with them, or who has not had a child placed with them for no longer than 52 weeks

  • is aged between 16 and 34 and has spent at least three months in a homeless hostel (as defined in the regulations) and has accepted resettlement support. The three month period does not have to be continuous, or in a single hostel, or immediately before the housing benefit claim is made (before 31 May 2021 this exemption applied only to claimants under between 25 and 34)

  • is an ex-offender aged between 25 and 34 who is subject to a Multi Agency Public Protection Arrangement (MAPPA)

In case brought by a claimant with a disability who did not qualify for the severe disability premium, the Upper Tribunal held that the availability of discretionary housing payments meant that the rule restricting their benefit to the shared accommodation rate was not manifestly without reasonable foundation.[25]

Universal credit claimants are subject to different rules.

Setting LHA rates

Normally LHA rates are set in January and take effect in April each year. Current LHA rates, by postcode and local authority, are available from the Valuation Office Agency (VOA).

The rent officer compiles a list of LHA rates for each broad market rental area and each category of dwelling within that area up to the rate for a four-bedroom property. The LHA for a person living in a property that has five bedrooms or more is based on the four-bedroom rate.

LHA rates are generally fixed at the 30th percentile point for rents in each size category of dwelling based on market rents paid by tenants who are not receiving housing benefit.[26]

Between April 2016 and 31 March 2021 LHA rates were frozen at the lower of either the April 2015 rate or the 30th percentile point.[27] From 1 April 2020 LHA rates were increased to again cover the lowest 30 percent of market rents in each area.[28] LHA rates have been frozen at the same level in cash terms for 2021/22.[29]

LHA rates must be published by the local authority. Authorities should take steps to ensure that the up-to-date rates are brought to the attention of those who may be eligible.[30]

Challenging LHA rates

There is no right of appeal regarding the amount of the LHA rate, although an appeal can be made concerning the size criteria that has been applied to a claimant. The decision making process whereby a BRMA is drawn or the LHA rates are set could be challenged by judicial review

It may be possible to complain to the Local Government and Social Care Ombudsman. In one case,[31] where the local authority had erroneously advised about the amount of LHA a claimant would be entitled to when moving from temporary accommodation to private renting, the Ombudsman recommended that the local authority paid the difference between the LHA rate paid and the rent for the duration of the fixed-term tenancy.

Reviewing claimant's LHA rate

The claimant's LHA rate is to be uprated annually, on 1 April or the first Monday in April, unless there has been a relevant change of circumstances, death of a linked person, or a change of address.

Where there is an increase or decrease in a claimant's rent following the annual review and the rent is less than the LHA rate, this is to be treated as a change of circumstances, and the housing benefit varied (but to no higher than the applicable LHA rate).[32]

Linked person

A linked person is a:

  • member of the claimant's family, ie their partner or dependent child/young person who is part of the claimant's household[33]

  • relative of the claimant or their partner living in the same dwelling, unless the relative has a separate right to occupy the premises

Last updated: 17 June 2021

Footnotes

  • [1]

    reg 13 Housing Benefit Regulations 2006 SI 2006/213, as amended by Housing Benefit (Local Housing Allowance and Information Sharing) Amendment Regulations 2007 SI 2007/2868.

  • [2]

    reg 13D Housing Benefit Regulations 2006 SI 2006/213, as amended by Housing Benefit (Local Housing Allowance and Information Sharing) Amendment Regulations 2007 SI 2007/2868.

  • [3]

    para 4 Sch.3B Rent Officers (Housing Benefit Functions) Amendment Order 2007 SI 2007/2871.

  • [4]

    Article 4B1A Rent Officers (Housing Benefit Functions) Order 1977 SI 2001/3651, as amended by Rent Officers (Housing Benefit Functions) Amendment Order 2007 SI 2007/2871.

  • [5]

    Rent Officers (Housing Benefit Functions) Amendment (No. 2) Order 2008 SI 2008/3156.

  • [6]

    reg 13D Housing Benefit Regulations 2006 SI 2006/213, as amended by as amended by Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2013 SI 2013/2828 and reg 4 Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2017 SI 2017/213.

  • [7]

    R (on the application of MA & others) v Secretary of State for Work and Pensions [2016] UKSC 58.

  • [8]

    paras 27-34 HB Circular A10/2013.

  • [9]

    para 3A reg 13D Housing Benefit Regulations 2006 SI 2006/213 as amended by reg 4(4) Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2017 SI 2017/213.

  • [10]

    para 3B reg 13D Housing Benefit Regulations 2006 SI 2006/213.

  • [11]

    para 44 HB Circular A4/2012.

  • [12]

    reg 13D(11) Housing Benefit Regulations 2006 SI 2006/213, as amended by Housing Benefit (Amendment) Regulations 2013 SI 2013/665; Rent Officers (Housing Benefit Functions) Amendment Order 2013 SI 2013/666; HB Circular A10/2013.

  • [13]

    reg 13D(11) Housing Benefit Regulations 2006 SI 2006/213, as amended by Housing Benefit (Amendment) Regulations 2013 SI 2013/665; Rent Officers (Housing Benefit Functions) Amendment Order 2013 SI 2013/666; HB Circular A10/2013.

  • [14]

    reg 13D(3) Housing Benefit Regulations 2006 SI 2006/213 as amended by reg 4(4) Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2017 SI 2017/213; HB Circular A25/2010; Commissioners decision CH/1615/2008.

  • [15]

    Housing Benefit (Amendment) Regulations 2010 SI 2010/2835; HB Circular A3/2011.

  • [16]

    SD v Eastleigh Borough Council (HB) [2014] UKUT 325 (AAC).

  • [17]

    reg 2 Housing Benefit Regulations 2006 SI 2006/213 as amended by reg 4(2) Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2017 SI 2017/213.

  • [18]

    reg 13D Housing Benefit Regulations 2006 SI 2006/213, as amended by para 2(6) Housing Benefit (Amendment) Regulations 2010 SI 2010/2835.

  • [19]

    para 52 HB Circular A4/2012.

  • [20]

    reg 2(1) Housing Benefit Regulations 2006 SI 2006/213, as amended by reg 2(2) Housing Benefit (Amendment) Regulations 2011 SI 2011/1736.

  • [21]

    reg 2(1) Housing Benefit Regulations 2006 SI 2006/213 as amended by reg 2(2) Housing Benefit (Amendment) Regulations 2011 SI 2011/1736; and reg 13D(2) Housing Benefit Regulations 2006 SI 2006/213.

  • [22]

    reg 13D(2) Housing Benefit Regulations 2006 SI 2006/213.

  • [23]

    JS v SSWP and Cheshire West and Cheshire BC (HB) [2014] UKUT 36 (AAC).

  • [24]

    reg 2(1) and (1B) Housing Benefit Regulations 2006 SI 2006/213, as amended by the Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2013 SI 2013/2828. and the Housing Benefit and Universal Credit (Care Leavers and Homeless) (Amendment) Regulations 2021 SI No.546/2021.

  • [25]

    CM v (1) Bradford Metropolitan District Council (2) Secretary of State for Work and Pensions: [2020] UKUT 285 (AAC)

  • [26]

    Sch.3B Rent Officers Housing Benefit Functions) Order 1997 SI 1997/1984 as amended by art 2 Rent Officers (Housing Benefit Functions) Order 2010 SI 2010/2836.

  • [27]

    Sch.3B Rent Officers (Housing Benefit Functions) Order 1997 SI 1997/1984 as amended by art 2 Rent Officers (Housing Benefit and Universal Credit Functions) (Local Housing Allowance Amendments) Order 2015 SI 2015/1753 and art 2 The Rent Officers (Housing Benefit and Universal Credit Functions) (Amendment) Order 2020 SI 2020/27; para 1.137 Summer Budget 2015.

  • [28]

    reg 4 Social Security (Coronavirus) (Further Measures) Regulations 2020/371; see also The Social Security (Coronavirus) (Further Measures) Amendment Regulations 2020 SI 2020/397.

  • [29]

    The Rent Officers (Housing Benefit and Universal Credit Functions) (Modification) Order 2020 (SI.No.1519/2020.

  • [30]

    reg 13E Housing Benefit Regulations 2006 SI 2006/213, as amended.

  • [31]

    Ombudsman complaint against Newham LBC, 9 November 2010 09/003/325.

  • [32]

    reg 13C Housing Benefit Regulations 2006 SI 2006/213 as amended by regs 3 and 4 Housing Benefit (Amendment) Regulations 2012 SI 2012/3040; HB Bulletin A8/2012.

  • [33]

    s.137(1) Social Security Contributions and Benefits Act 1992.