Local Housing Allowance (LHA)

Local Housing Allowance (LHA) is a way of working out Housing Benefit for private tenants.

If you are renting a property or room from a private landlord, Local Housing Allowance is used to work out how much Housing Benefit you get.

The amount of Housing Benefit you get will depend on where you live and who lives with you. Benefit is based on the number of bedrooms you need and not how much the rent is.

Local Housing Allowance rates are set for different types of accommodation in each area. The rates range from a single room in a shared house, up to properties with four bedrooms.

The rates that are set are the maximum amounts, the actual amount of entitlement will depend on your income, savings and circumstances.

Local Housing Allowance ensures that people with the same circumstances, living in the same area, will receive the same amount of benefit. You can choose accommodation, knowing how much rent we will use to work out your benefit, from the LHA rates set by the Valuation Office Agency (VOA).

Local Housing Allowance applies to anyone who lives in private rented accommodation and has made a new claim for Housing Benefit, or has changed their address or had a break in their claim, on or after 7 April 2008.

Local Housing Allowance does not affect you if

• you live in a home which is owned by the council
• you are a tenant of a registered social landlord (housing association), registered charity or voluntary organisation
• you live in supported housing
• your tenancy started before 15 January 1989
• you live in a caravan, mobile home, houseboat or hostel
• you claim benefit for help with mooring fees
• the Rent Officer has decided that a large part of the rent you pay for your tenancy is for meals cooked for you.

If any of the above groups apply to you, please see the Housing Benefit section for information on how your Housing Benefit is worked out. If you move address or stop claiming Housing Benefit for at least one week, we may work out your new claim under the LHA rules.

The maximum amount of Housing Benefit you can get depends on:

• the number of bedrooms you need;
• the area you live in; and
• the rate set by the Valuation Office Agency (VOA) for this number of bedrooms for the area you live in.

The rates that are set by the VOA are the maximum amounts, the actual amount of entitlement will depend on your personal and financial situation.

Number of rooms

The maximum rate for Local Housing Allowance is the four-bedroom Local Housing Allowance rate. If your family needs 5 or more bedrooms, you will be restricted to the 4 bedroom rate.

We will decide how many rooms according to the Housing Benefit rules you need.

• If you live in one room and share some facilities (for example a kitchen or bathroom) with other people, you will only receive the rate for shared accommodation.
• If you are under 35 and live on your own, you will only be entitled to the rate for shared accommodation.
• Single claimants aged 35 and over, care leavers aged 24 and under, former residents of specialist hostels for homeless persons, and childless couples will qualify for the one bedroom rate of LHA, but if you choose to live in shared accommodation you will only receive the rate for shared accommodation.
• From 1 October 2022 domestic violence victims and victims of modern slavery will qualify for the one bedroom rate of LHA, but if you choose to live in shared accommodation you will only receive the rate for shared accommodation.
• If you are severely disabled, or live with a severely disabled partner, and have no dependent children, your benefit will be based on the one bedroom Local Housing Allowance rate.

If the above categories do not apply to you, we will work out your number of rooms as one bedroom for each of the following:

• a couple
• someone who is 16 or over
• two children of the same sex until they are 16
• two children who are younger than 10
• a child (someone under 16).

You may also be allowed an additional bedroom if:

• you or your partner need overnight care from someone who doesn’t normally live with you;
• you are an approved foster carer and either have a foster child/children living with you or you are waiting for a child/children to be placed with you;
• your children are unable to share a bedroom because of severe disabilities – we will assess your individual circumstances and decide where it is inappropriate for the children to be expected to share a room.

Please note if you have an adult child or children who are away from home serving as a member of the Armed Forces, a bedroom will continue to be allowed for them as long as they have an intention to return to your property.

You can use the online LHA bedroom calculator to check your bedroom entitlement.

If your rent is higher than the Local Housing Allowance

The maximum Housing Benefit you will receive is the LHA rate for the size of your household in your area. If your rent is more than this figure, you will need to make up this shortfall yourself.

If you are having difficulties, you may be able to apply for a discretionary housing payment.

If your rent is lower than the Local Housing Allowance

The maximum Housing Benefit you can receive will not be more than your rent.

Examples of Local Housing Allowance calculations

Example – LHA is less than the rent

Ryan lives with his 2 children, Alison who is 4 and Luke who is 10. They require a three bedroom property, so the three bedroom LHA rate will apply. In this example the three bedroom LHA rate is £167.31 per week. The rent for the property is £750 per month, which works out at £173.08 per week.

As the LHA rate is lower than the rent we will calculate Ryan’s Housing Benefit based on £167.31 per week.

Example – LHA is the same as the rent

Brooke and Nathan live with their two female children, Rachael and Peyton, twins aged 5. They require a two bedroom property, so the two bedroom LHA rate will apply. In this example the LHA rate is £120 per week. The rent for their property is £520 per month, which works out at £120 per week.

As the LHA rate is the same as the rent we will calculate Brooke and Nathan’s benefit based on £120 per week.

Example – LHA is more than rent

Charlotte lives with her 5 month old baby, John. They require a two bedroom property, so the two bedroom LHA rate will apply. In this example the LHA rate is £144.23 per week. The rent for their property is £600 per month which works out at £138.46 per week.

Even though Charlotte has found a property cheaper than the LHA rate, we cannot pay more than the rent so we will calculate Charlotte’s Housing Benefit based on £138.46 per week.

Example – a couple living in a three bedroom property, when they are only entitled to two bedrooms

Emma and Daniel live with their 5 year old daughter, Samantha. They rent a three bedroom property, with a rent of £750 per month, which works out at £173.08 per week. Under LHA rules, they require a two bedroom property, so the two bedroom LHA rate will apply. In this example the LHA rate is £150 per week.

As their rent is more than the LHA rate, we will calculate Emma and Daniel’s benefit based on £150 per week, meaning they would have to pay a top up of at least £23.08 per week.

Example – a couple living in a two bedroom property, when they are entitled to three bedrooms

Sophie and Oliver live with their two children Ellie, 12, and Carl, 8. They rent a two bedroom property, with a rent of £525 per month, which works out at £121.15 per week. Under LHA rules, they require a three bedroom property, so the three bedroom LHA rate will apply. In this example the LHA rate is £138.46 per week.

Even though Sophie and Oliver have found a property cheaper than the LHA rate, we cannot pay more than the rent so we will calculate their benefit based on £121.15 per week.

The Valuation Office Agency (VOA) is an executive agency of HM Revenue and Customs (HMRC). The VOA provides valuations for local authorities in England, for use in the assessment of claims for Housing Benefit where the tenant is renting from a private landlord.

The Valuation Office Agency has divided the country into broad rental market areas (BRMAs). These are made up of a number of neighbourhoods. In each area there is a wide mix of property types within a reasonable distance of various public services such as health, education, leisure, personal banking and shopping. The Rent Officer uses these BRMAs to set the Local Housing Allowance rates.

There are a number of different rates for each area based on the number of rooms each household needs.

Use the online advisor to find out which BRMA you live in

Local Housing Allowance is mainly paid to claimants direct. Claimants can no longer choose to have their allowance paid direct to their landlord. As a result, most claimants will have their LHA paid directly into their bank account and will therefore be responsible for managing their own finances and paying their own rent.

In recognition that some claimants may have difficulty with the responsibility of budgeting for, and paying their rent, a system of safeguarding has been put into place.

Being safeguarded means that a decision is made to make payments to the landlord, not the claimant.

Information on when we may pay benefit direct to landlords is detailed in our Safeguard Policy (PDF).

For us to make payments direct to the landlord, a direct payment form must be completed.