Housing costs and rent under Universal CreditV1-JW-20161005


This guide looks at specific housing related aspects of Universal Credit. Under Universal Credit housing costs are paid as one of the elements of the claim to assist tenants with their rental payments. This is paid as one of the elements of tenants’ benefits.

Housing Costs - conditions

Instead of a separate payment for rent, under UC the Claimant/Tenant is paid housing costs, which is one of the elements which make up the total UC monthly payment. To be eligible a Claimant must be responsible for paying rent, there must be a legal liability to pay rent and the Claimant must occupy the property. Housing costs are based on the lower of the relevant local housing allowance and the actual rental payment. Payment can normally only be made in respect of one property at a time.

Payment for two properties

Payment for two properties is possible where;

  • a property is being adapted due to disability and a member of the benefit unit is in receipt of Attendance Allowance, Disability Living Allowance (care component at the middle or higher rate), Personal Independence Payment (daily living component at either rate), or Constant Attendance Allowance (paid as part of industrial injuries Disablement Benefit or War Disablement Benefit).
  • a member of the benefit unit moves somewhere else temporarily due to fear of violence in the home or by a former partner.
  • the family unit is so large that more than one house is necessary.

If someone cannot move into accommodation immediately because he/she is in hospital or care housing costs can be paid for the new accommodation for up to one month.

Where the Claimant is unable to live in a property due to its condition, e.g. it is affected by flooding or major repairs are needed, then housing costs can either be paid in respect of that property or alternative accommodation (but not both).

Proof of Tenancy

DWP will require proof of the existence of the tenancy before housing costs can be paid. They will ask to see the tenancy agreement. If this is not produced, if one does not exist, then the DWP will contact the landlord for confirmation of the existence of the tenancy.

Paying housing costs under Universal Credit

Universal Credit is completely different to the current Housing Benefit scheme. From the landlord's perspective, very much more labour intensive, technically more complicated, significantly more risky, financially punitive and poses a much greater threat to tenancy sustainment, than housing benefit ever has.

DWP Guidance for landlords

DWP have published a Guide for Landlords. To read the latest version click here. This gives details about what you need to do for example if you want to claim direct payments.

How are housing costs calculated for private landlords?

Private landlords are paid the lower of the actual rent payable or the applicable local housing allowance amount. The same calculation is made as is currently made for LHA. As part of the roll out for Universal Credit the Government are not currently proposing any changes to the existing LHA regime for this purpose. Housing costs will be limited to a maximum of four bedrooms as is now applied to LHA. Normally, rents will be determined annually according to broad market rental areas but as with LHA, rates are currently frozen.

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