The New Benefit Cap - What you need to know
In 2013 Central Government introduced a limit on the total amount of benefit that most people aged 16 to 64 can get. This is called the benefit cap and how much you get for certain benefits may be restricted to make sure the total you get isn't more than the cap amount. The cap amount and the benefits that are affected by the cap changed on 7 November 2016.
You're not affected by the cap if you or your partner work, and either of the following apply:
- you or your partner are eligible for Working Tax Credit
- you or your partner get Universal Credit, and your household income is more than £430 a month after tax and National Insurance
The cap applies to the total amount people in your household (you, your partner and any children living with you) get from the following benefits:
- Bereavement Allowance
- Carer's Allowance (this won't be affected by the benefit cap from 7 November 2016)
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance (unless you get the 'support' component)
- Guardians Allowance (this won't be affected by the benefit cap from 7 November 2016)
- Housing Benefit
- Incapacity Benefit
- Income Support
- Jobseekers Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Widowed Parent's Allowance (or Widowed Mother's Allowance or Widows Pension if you started getting it before 9 April 2001)
- Universal Credit (unless you've had a work capability assessment and aren't fit for work)
Payments towards carer's costs in Universal Credit are not affected by the benefit cap from 7 November 2016.
You're not affected by the cap if anyone in your household qualifies for Working Tax Credit or gets any of the following benefits:
- Armed Forces Compensation Scheme
- Armed Forces Independence Payment
- Attendance Allowance
- Disability Living Allowance (DLA)
- Employment Support Allowance (if you get the support component)
- Industrial Injuries Benefits (and equivalent payments as part of a War Disablement Pension or the Armed Forces Compensation Scheme)
- Personal Independence Payment (PIP)
- Universal Credit payment for 'limited capability for work and work-related activity'
- War Pensions
- War Widows or War Widowers Pensions
If you have adult children or non-dependants living with you and they qualify for any of these benefits you may still be affected by the cap. This is because they're not usually included in your household.
From 7 November 2016 the amount of cap depends on where you live in the UK.
Outside Greater London
If you live outside a Greater London Borough, the cap is:
- £384.62 per week (£20,000 a year) if you're in a couple, whether your children live with you or not
- £384.62 per week (£20,000 a year) if you're single and your children live with you
- £257.69 per week (£13,400 a year) if you're single and you don't have children, or your children don't live with you
If you live in Boston then these are the amounts that will be used to calculate your total benefit entitlements.
Inside Greater London
If you live in a Greater London borough, the cap is:
- £442.31 per week (£23,000 a year) if you're in a couple, whether your children live with you or not
- £442.31 per week (£23,000 a year) if you're single and your children live with you
- £296.35 per week (£15,410 a year) if you're single and you don't have children, or your children don't live with you
The cap is a little more generous inside the Greater London area due to the difference in the cost of living and rental charges.
You can find out if you are affected by these changes by clicking on this Benefit Cap Calculator