What is Bedroom Tax?
The United Kingdom government, in Apr-13, introduced a tax on additional bedrooms for individuals residing in housing association property. The Bedroom tax, introduced under the Welfare Reform Act 2012, replaced the spare room subsidy. Under the modifications, occupants in social housing can reduce their benefit by 14% if the occupant(s) has one spare bedroom or by 25% if the occupant has two or more spare bedrooms.
Additionally, two youngsters below 16 years of age and of the similar gender are anticipated to share a portion of one bedroom, and the same rule also applies for two children below 10, irrespective of similar gender. On average, an occupant impacted by the bedroom tax loses between £14 a week - £25 a week.
Also, referred to as under-occupancy charge, the Bedroom Tax is an amendment to ‘Housing Benefit’ claim which means that an individual will be given or will receive a reduced percentage in housing benefit if he/she resides in a council property or housing association that is considered to have one or multiple spare bedrooms. Below mentioned are conditions under bedroom tax:
For example, an individual’s weekly entitled rent amount is £70 and the person is residing in a 2-bedroom flat as a single member. As per the rules of bedroom tax, if an individual has one spare bedroom, then the ‘entitled rent’ amount will decrease by 14%. Hence, the applicable new entitled rent amount will be £60.20, and this is the maximum Housing Benefit amount an individual will be paying.
|Household arrangement||One bedroom||Two bedrooms||Three bedrooms||Four bedrooms|
|Lone parent staying with a child or a couple||NA||NA||14%||25%|
|Lone parent with two children both above 10 years or a couple||NA||NA||14%||25%|
|Lone parent with two boys above 16 years or a couple||NA||NA||14%||25%|
|Lone parent residing with a girl aged 10 and boy aged 12 years or just a couple||NA||NA||NA||14%|
|Lone parent with two boys aged 12 years and 17 years||NA||NA||NA||14%|
The bedroom tax/under-occupancy charge will have an impact on individuals residing in social accommodation, who get Housing Benefit and have additional bedrooms in their house than actually required. The reduction in Housing benefit is usually termed as ‘bedroom tax’ and an individual will only be impacted by this variation if he/she gets Housing Benefit. The bedroom tax won’t impact an individual if he/she:
According to the United Kingdom government, the Bedroom tax was proposed to reduce the housing benefit bill and make some space available to assist 300,000 United Kingdom individuals residing in congested accommodation. The Department for Work and Pensions (DWP) defined a benchmark of 30% of tenants residing in social housing to move home by 2017. However, the exemption list includes parents of teenage armed forces personnel and foster carers.
Number of Bedrooms permitted by the United Kingdom Government for families
What makes a ‘spare bedroom’: One bedroom is permitted for every person stated below:
Bedroom tax was primarily introduced to inspire council residents residing in houses which are too huge according to their needs and there is a possibility to shift to a lesser-in-size property, thus releasing space for large clans residing in small accommodations. The bedroom tax is applicable for residents staying in social housing i.e. a property controlled by a housing association or a council, and they claim housing benefit. Basically, if an individual is of working age and has bedrooms which are more than what is permitted by the rule, hence, the tax applies.
Exemption from Bedroom Tax
If an individual hasn’t applied for housing benefit since the past year, the tax will not be applicable for the initial 13 weeks of claim. A number of housing types also fall under the preview of exemption and this includes mobile homes, temporary accommodation, and houseboats. Additionally, if an individual has a child with disability, in armed forces or fostered then in such a scenario an individual might be eligible to an additional bedroom:
Definition of Bedroom
There is no specific Government regulations around the definition of a 'bedroom'. It's on the landlord’s discretion to choose, depending on the property size and what is stated on the occupancy contract. However, there is no difference amongst a single bedroom or double bedrooms – both are treated as a bedroom!
The following are not categorised as occupying a bedroom:
What happens if an individual can’t pay 'Bedroom Tax?'
If 'bedroom tax' rules have impact on an individual, he/she might be concerned about managing to pay tax with less money. It is imperative to ensure that an individual always gives high priority to his/her rent payments as any amount outstanding can result in an individual losing their home. A tenant should have a good look over his/her budget and compute any savings he/she will make – there might be a scenario where an individual is eligible for state benefits or tax credits and is not claiming them.