Housing costs under Universal Credit

Yamor

Has anyone seen any explanation why all council tax reduction schemes include universal credit in it's entirety as income?

As it stands, housing benefit does not get counted, so why should the housing costs element of universal credit be counted?

Also, does anyone know what will be done with the housing costs element of UC in 53-week years?
The regulations clearly state that weekly payments will be converted to monthly rates assuming 52 weeks in the year - that would lead to quite a big loss for a 53-week year.

Solitaires

Yamor wrote: »

Has anyone seen any explanation why all council tax reduction schemes include universal credit in it's entirety as income?

As it stands, housing benefit does not get counted, so why should the housing costs element of universal credit be counted?

Also, does anyone know what will be done with the housing costs element of UC in 53-week years?
The regulations clearly state that weekly payments will be converted to monthly rates assuming 52 weeks in the year - that would lead to quite a big loss for a 53-week year.

Because of the benefit cap I would imagine.

beecher2

Yamor wrote: »

The regulations clearly state that weekly payments will be converted to monthly rates assuming 52 weeks in the year - that would lead to quite a big loss for a 53-week year.

There are always 52 weeks in the year - they will multiply the weekly rate by 52 and divide by 12 to give a monthly rate. There will be no loss, ie if you got £120 a week, you'd get £6240 a year at present (£120x52). This is the same figure as you'd get if you were paid monthly (£520 x12)

jamie11

Yamor wrote: »

Has anyone seen any explanation why all council tax reduction schemes include universal credit in it's entirety as income?

As it stands, housing benefit does not get counted, so why should the housing costs element of universal credit be counted?

Also, does anyone know what will be done with the housing costs element of UC in 53-week years?
The regulations clearly state that weekly payments will be converted to monthly rates assuming 52 weeks in the year - that would lead to quite a big loss for a 53-week year.

Yebbut, I'd assume the yearly amount would be paid in 12 increments instead of 26 or 13 as at present.

Most rents are charged monthly so why should that be a problem.

I foresee a hell of a lot of evictions of LHA tenants though if landlords cannot be paid directly, I know I will lose patience with mine the first time a rent is missed once she's put onto UC.

Nada666

Don't confuse the four weeks in a month simplification with only fifty-two weeks in a year.

Missing out on one day a year is not the same as losing 29 days a year.

lighting_up_the_chalice

jamie11 wrote: »

Yebbut, I'd assume the yearly amount would be paid in 12 increments instead of 26 or 13 as at present.

Most rents are charged monthly so why should that be a problem.

I foresee a hell of a lot of evictions of LHA tenants though if landlords cannot be paid directly, I know I will lose patience with mine the first time a rent is missed once she's put onto UC.

LHA tenants already get the rent sent to them by default, unless they are vulnerable.

Coraline

beecher2 wrote: »

There are always 52 weeks in the year - they will multiply the weekly rate by 52 and divide by 12 to give a monthly rate. There will be no loss, ie if you got £120 a week, you'd get £6240 a year at present (£120x52). This is the same figure as you'd get if you were paid monthly (£520 x12)

HAs (at least mine) count every 7th year as a 53 week year, or their version of a leap year in order to recoup the days of rent they "lost" by having too many Februarys!

So to figure out what to take out of my bank account per month for this year, it's (weekly rent X 53) / 12 .

What a system! At least the next one won't be until 2020!

Yamor

As far as I know, all council tax reduction schemes as well as the default scheme from the government include UC as income without excluding the housing costs element.

Every 5-6 years, someone who pays rent weekly, will pay 53 payments in a year instead of 52 times. In such a year, such a person would not receive any benefit for the extra week. At least, that is what would happen according to the regulations as they stand.
What is interesting about this is that for most other calculations that the government made to convert amounts from weekly to monthly they took into account that a year is a day more then 52 weeks, but not for this.

Housing_Benefit_Officer

Extract only SI 2013/0376
Universal Credit Regulations 2013

SCHEDULE 4
Housing costs element for renters

Relevant payments calculated monthly
7.-
(1) Where any relevant payment is to be taken into account under paragraph 6, the amount of that payment is to be calculated as a monthly amount.
(2) Where the period in respect of which a renter is liable to make a relevant payment is not a month, an amount is to be calculated as the monthly equivalent, so for example-
(a) weekly payments are multiplied by 52 and divided by 12;
(b) four-weekly payments are multiplied by 13 and divided by 12;
(c) three-monthly payments are multiplied by 4 and divided by 12; and
(d) annual payments are divided by 12.
(3) Where a renter is liable for relevant payments under arrangements that provide for one or more rent free periods, the monthly equivalent is to be calculated over 12 months by reference to the total number of relevant payments which the renter is liable to make in that 12 month period.
(4) "Rent free period" means any period in respect of which the renter has no liability to make one or more of the relevant payments which are to be taken into account under paragraph 6.

Housing_Benefit_Officer

As far as I am aware the Housing Cost element will be identified and disregarded for LCTS it would be bonkers to include the payment as income.

Yamor

Housing_Benefit_Officer wrote: »

Extract only SI 2013/0376
Universal Credit Regulations 2013

SCHEDULE 4
Housing costs element for renters

Relevant payments calculated monthly
7.-
(1) Where any relevant payment is to be taken into account under paragraph 6, the amount of that payment is to be calculated as a monthly amount.
(2) Where the period in respect of which a renter is liable to make a relevant payment is not a month, an amount is to be calculated as the monthly equivalent, so for example-
(a) weekly payments are multiplied by 52 and divided by 12;
(b) four-weekly payments are multiplied by 13 and divided by 12;
(c) three-monthly payments are multiplied by 4 and divided by 12; and
(d) annual payments are divided by 12.
(3) Where a renter is liable for relevant payments under arrangements that provide for one or more rent free periods, the monthly equivalent is to be calculated over 12 months by reference to the total number of relevant payments which the renter is liable to make in that 12 month period.
(4) "Rent free period" means any period in respect of which the renter has no liability to make one or more of the relevant payments which are to be taken into account under paragraph 6.

Exactly. So, according to 7(2)(a) the person would receive over a period of a year 52 times his weekly rent EVEN in a year where they are paying 53 payments!