The benefit cap limits the total amount of benefit that can be paid to a non-working household
This information applies to people living in England, Wales, Scotland & Northern Ireland.
Note: Since 7th November 2016 carers in England, Wales & Scotland who are receiving Carer's Allowance, the underlying entitlement to Carer's Allowance or a Carer Element within Universal Credit are exempt from the benefit cap (such carers are already exempt in Northern Ireland).
Note: Since 7th November 2016 the benefit cap levels have lowered (see the section below called 'How much is the benefit cap?' for further information).
Note: Before 7th November 2016 carers in England, Wales & Scotland who were receiving Carer's Allowance, the underlying entitlement to Carer's Allowance or a Carer Element within Universal Credit were not exempt from the benefit cap in their own right - for further information on the situation before 7th November 2016 you can read our Q&A on carers and the benefit cap.
Who will the benefit cap apply to?
The benefit cap will apply to household's who get Housing Benefit who are below state pension credit age and household's who get Universal Credit (which won't yet apply to Northern Ireland as Universal Credit has not yet been introduced).
The way that a ‘household’ is defined in the benefits system doesn’t just mean the people who live in the same home. For the purposes of the benefits system, a ‘household’ is considered to be an adult, their partner (if they have one) and any dependent children. If any other adult relatives, like older parents, brothers and sisters or even adult children live in the same house they are considered to be part of a different benefits ‘household’ even though they live together. Where we use the word household we mean benefit household, not people who live together in the same house.
Note: In Northern Ireland the benefit cap was introduced on 31st May 2016 and some measures have been put in place for certain people who are affected by the benefit cap (this is following ‘A Fresh Start: the Stormont Agreement and Implementation Plan’). This measure is that if you are affected by the benefit cap and live with, and are responsible for, a child or qualifying young person, you should get a supplementary payment to cover the loss which can be paid for up to four years (although the amount of the supplementary payment may reduce if your benefit entitlement reduces in this time).back to top
How much is the benefit cap?
From 7th November 2016 the benefit cap levels are set at:
- approx. £385 a week (£20,000 a year) for couples with or without children, and lone parents with children, who don't live in Greater London
- approx. £442 a week (£23,000 a year) for couples with or without children, and lone parents with children, who do live in Greater London
- approx. £258 a week (£13,400 a year) for single people without children, who don't live in Greater London
- approx. £296 a week (£15,410 a year) for single people without children, who do live in Greater London
The amount of money your benefit household receives from certain benefits will be added together. If this amount is higher than the cap levels, deductions will be taken from your Housing Benefit or Universal Credit to bring your weekly income from benefits below the cap level.
Note: Before 7th November 2016 the benefit cap levels were set at:
- £500 a week (£26,000 a year) for couples with or without children, and lone parents with children
- £350 a week (£18,200 a year) if you are single without children
If you are affected by the lowered benefit cap levels from 7th November 2016, when exactly this will affect you will depend on where you live, as the roll out is expected to take place from 7th November 2016 and won’t be finished until the end of January 2017.back to top
Which benefits are taken into account?
The benefits that will be taken into account when calculating the benefit cap are:
- Universal Credit
- Housing Benefit
- Incapacity Benefit
- Income Support
- Employment and Support Allowance (ESA) (contributory and income-related) except where the Support Component has been awarded
- Child Benefit
- Child Tax Credit
- Jobseekers Allowance (contribution-based and income-based)
- Maternity Allowance
- Severe Disablement Allowance (SDA)
- Widow’s Pension
- Bereavement Allowance
- Widowed Parent's Allowance
- Widowed Mothers Allowance
Note: Before 7th November 2016 Carer's Allowance and Guardian's Allowance were taken into account when calculating the benefit cap in England, Wales & Scotland.back to top
Which benefits are not taken into account?
The benefits and payments that will be disregarded when calculating the benefit cap are:
- Council Tax Reduction schemes
- Discretionary Housing Payments
- Social Fund Payments – all one off payments:
- Budgeting Loans
- Cold Weather Payments
- Funeral Payments
- Sure Start Maternity Grants
- Winter Fuel Payment
- Pension Credit
- Bereavement payment
- Residency order payments
- Statutory Adoption Pay – paid by employers
- Statutory Maternity Pay – paid by employers
- Statutory Paternity Pay – paid by employers
- Statutory Sick Pay - paid by employers
- Bereavement payment (the new bereavement support payment will also be disregarded)
- Retirement pension
Who is exempt from the benefit cap?
The benefit cap will not apply to you if someone in your ‘benefit household’ (you, your partner or a dependent child) receives:
- Carer's Allowance, the underlying entitlement to Carer's Allowance or a Carer Element within Universal Credit (in England, Wales & Scotland this has only been the case since 7th November 2016)
- Working Tax Credit
- The support component of Employment and Support Allowance
- The limited capability for work and work related activity element of Universal Credit
- Disability Living Allowance (DLA) or Personal Independence Payment (PIP)
- Attendance Allowance
- Industrial Injuries Benefit (and equivalent payments under the War Disablement Pension or Armed Forces Compensation Scheme)
- War widow’s or widower’s pension
- Guardian's Allowance (in England, Wales & Scotland this has only been the case since 7th November 2016)
This means that you could still be affected by the benefit cap if you are caring for an adult disabled son or daughter or other adult relative, even if they are living with you, if you are not getting Carer's Allowance, the underlying entitlement to Carer's Allowance or a Carer Element within Universal Credit. This is because they would not be considered to be in the same benefit household. The adult disabled person would not see their own benefits capped if they receive one of the benefits listed above, but this protection from the cap would only apply to them (or, if they have a partner or any children themselves, the partner and children). This protection from the cap would not extend to other people who aren’t treated as being within the same benefit household as them.
Here are a couple of examples to illustrate this:
Example 1: Phillip and Trish care for their disabled son Mark who is 15 and receives DLA. Because all three are considered to be part of the same ‘household’ (because they are a couple and their son is under 18), the fact that Mark receives DLA means that they will all be exempt from the benefit cap.
Example 2: Tony and Christine care for their disabled daughter Jess who is 19 and receives PIP. Jess lives with her mum and dad but her benefits (PIP and Employment and Support Allowance) aren’t considered to be part of the same ‘household’ because Jess is an adult. So whilst Jess’s benefits would not be capped, Tony and Christine could have their benefits capped if neither of them receive Carer's Allowance, the underlying entitlement to Carer's Allowance or a Carer Element within Universal Credit.
Note: If you are not exempt from the benefit cap but live in Northern Ireland then if you live with, and are responsible for, a child or qualifying young person, you should get a supplementary payment – see note in the section called “Who will the benefit cap apply to?” for further information.back to top
What can you do?
Take on work
There will be a grace period whereby the benefit cap will not be applied for 39 weeks if you or your partner were formerly in work (either employed or self-employed) for a continuous period of at least 50 out of the last 52 weeks. The person in work must not have been entitled to Employment and Support Allowance, Jobseekers Allowance or Income Support during this time.
The advice from the DWP is to take on work which will increase your income and if you qualify for Working Tax Credits you will be exempt from the benefit cap. This clearly may not be possible for many carers. However if you are able to choose this option you should check you are getting all the in work benefits you are entitled to and are aware of your rights as a carer in the workplace such as time off in emergencies and the right to request flexible working.
Get a benefit check
Get a benefit check to ensure that you and the person you care for are getting all the benefits you are entitled to.
You may be able to get advice about benefits from your local Citizens Advice Bureau or another local advice agency. They may be able to help with form filling through to appeals and tribunals.
Many councils will also have their own welfare rights department or directories of local organisations who can help.
You can also contact the Carers UK Adviceline for a benefit check and for information about local support where you live.
Discretionary Housing Payments
Discretionary Housing Payments are additional payments on top of Housing Benefit or Universal Credit to support people who need help with their housing costs.
Discretionary Housing Payments are funded by a limited sum of money and most councils will not award Discretionary Housing Payment on an ongoing basis.
There is no appeal system for Discretionary Housing Payments but if you disagree with your council’s decision you should write to them within a month of receiving the letter telling you about the Discretionary Housing Payment decision and ask for your application to be looked at again.back to top