Question About Housing benefit

pbjackson

I have been investigating how the LHA is paid, because when the tax allowances go up to £10,000 this will increase my take home pay, but then I will lose my housing benefits. So while the Lib/Cons are lauding this as benefiting low earners, it is not strictly true ! They say low to middle income will get another £705 per year, but for HB claimants they lose 65% of this..So the high earners (not on HB) get £705, and low earners (on HB) get £247..widening the gap between the haves and have nots !

The problem is basically to do with how they assess your "income needs", which is made up of a personal allowance (not to be confused with personal tax allowance) , plus any extra "benefits" for age or circumstances. there are tables on Govt sites showing these figures.

I don't know exactly what these figures are based on, how they are inflated each year or what they might be linked to. They do not seem to be linked to personal tax allowances and therefor seem unlikely to rise when allowances go up to £10,000.

Thus, as tax allowances increases, take home pay increases but "income needs" remains at the old levels...?

Anyone who knows anything about this, or can advise, I would be forever gratefull..

bestpud

Tax credits are based on gross income, which will remain the same, so how will it reduce those?

I see your point about housing benefit but it is perhaps more helpful to think in terms of being one step closer to not needing housing benefit? Or one step closer to independance?

Plus you will still have more money in your pocket each week...

mossy

I have to say I had assumed that the income figures you would supply for Housing Benefit would be before tax.

dmg24

pbjackson wrote: »

I have been investigating how the LHA is paid, because when the tax allowances go up to £10,000 this will increase my take home pay, but then I will lose my housing benefits. So while the Lib/Cons are lauding this as benefiting low earners, it is not strictly true ! They say low to middle income will get another £705 per year, but for HB claimants they lose 65% of this..So the high earners (not on HB) get £705, and low earners (on HB) get £247..widening the gap between the haves and have nots !

This is quite an assumption!

pbjackson

To cover the points raised...bestpud..it is the fact politicians are saying ALL low earners will be £705 p/e better off, this is not correct.
Mossy - HB is based on take home pay.
dmg24...This has been lauded all through the election campaign and since as serious effort to raise living standards of low to middle income people.
Yes, more money in your pocket is good, but with politicians telling someone it must feel better to not be as reliant on HB while people not on HB get even more money in their pockets just sounds plain stupid to me, and certainly does NOT narrow the divide between income brackets, it actually widens it...the exact opposite of what they are aiming to achieve..