Benefit cap

The benefit cap restricts the total amount of benefits an out-of-work household can receive.

How much is the cap?

The cap is currently set at £20,000 per year for couples and lone parents outside Greater London, and £13,400 per year for single people without children. Within Greater London the cap is £23,000 for couples and parents and £15,410 for single people.

Which benefits are included?

The cap applies to the total amount people within a household will get from the following benefits:

• Bereavement Allowance
• Child Benefit
• Child Tax Credit
• Employment and Support Allowance (unless you get the ‘support’ component)
• Housing Benefit
• Incapacity Benefit
• Income Support
• Jobseeker’s Allowance
• Maternity Allowance
• Severe Disablement Allowance
• Widowed Parent’s Allowance (or Widowed Mother’s Allowance or Widows Pension if they started getting it before 9 April 2001)
• Universal Credit

Payments towards carer’s costs in Universal Credit have not been affected by the benefit cap since 7 November 2016.

Benefits that aren’t included

The cap does not apply if anyone in the 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 and Support Allowance (if they 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. Your payment won’t be affected if you or your partner receive Universal Credit:
  • because of a disability or health condition that stops you from working (this is called ‘limited capability for work and work-related activity’)
  • because you care for someone with a disability and you and your partner earn more than £569 a month combined, after tax and National Insurance contributions
• War pensions
• War Widow’s or War Widower’s Pension.

If you have adult children or non-dependents living with you and they qualify for any of these benefits, you may be affected by the cap. This is because they’re not usually included in your household.

Grace period

The cap will not apply for a 39 week grace period where a claimant loses their job after a period of continuous employment.

If you are claiming Universal Credit, the benefit cap will not be applied for a 9 month grace period if:

• You (and your partner) earned at least the amount you would get for 16 hours per week at national minimum wage for the previous 12 months.

If you are claiming Housing Benefit, the benefit cap will not be applied for a 39 week grace period if:

• You (or your partner) was working for at least 50 out of the previous 52 weeks, and;
• Whilst you (or your partner) were working, you were not entitled to Income Support, Jobseeker's Allowance or Employment and Support Allowance.

Supported housing

Housing Benefit or Universal Credit paid for ‘supported exempt accommodation’ and ‘specified accommodation’ is not included in the cap calculation.

When was benefit cap lowered?

As of May 2019, 75,000 households had their benefits capped: 50,000 had Housing Benefit capped and 26,000 had Universal Credit capped. Overall between April 2013 and May 2019, a total of 250,000 households had their benefits capped.