July 2015 Budget - Benefit Changes

In the summer budget, on 8 July 2015, the Chancellor announced a number of changes to benefits that will be introduced between now and 2017.

What has already happened?
Most benefits for people of working age have been frozen and will not increase for the next 4 years.

Benefit cap
The Benefit Cap will be reduced for families to a maximum of £20,000 per year, or £385 per week. Families already capped will lose an extra £115 per week. This means that some families with three or more children may be losing some or all of their Housing Benefit unless they receive some specified disability benefit, or Working Tax Credit. This is coming into effect from November 2016.  Any benefit above this cap rate will be deducted from housing benefit first.

The Department for Work and Pensions (DWP) will be writing to residents who will be affected by this change. If you will be affected, please contact the DWP as outlined on the letter, and please contact us to discuss this.

For many households, this will mean your  entitlement to any housing benefit is nil and you will be liable for full payment of rent. You can check whether you will be affected and by how much on the Benefit Cap calculator on the gov.uk website here.

From April 2016
There will be reductions in the rates of Working Tax Credit. There will also be a reduction in the rate of Employment Support Allowance for some new claimants and a reduction in Housing Benefit for some new claimants with children.

There will also be a reduction of 1% in most GreenSquare rents.

From April 2017
There will be reductions in Child Tax Credit and Housing Benefit for new claims and families who have a third child. There will also be further Child Tax Credit reductions for new claimants and the removal of Housing Benefit for some people aged under 21. Tenants who earn more than £30,000 per year will be expected to pay a market rent for their property.

Some of these changes are quite a long way off and we don’t have many more details at the moment. If you are worried that any of these changes may affect you, you can contact one of our advice partners for help.  You can find their contact details here.

For the latest information, read the Wiltshire Money Bulletin here.