Local Housing Allowance
What is Local Housing Allowance?
Local Housing Allowance (LHA) allows us to work out the amount of rent we should use when calculating how much Housing Benefit you are entitled to. It is a way of deciding the maximum amount of Housing Benefit you could receive based on the size of your household and where your property is located. To find out if Local Housing Allowance affects your rent.
How much benefit you are entitled to will still depend on your age, income, savings, the other people who live with you and proof of a valid tenancy agreement.
LHA will make it easier for you to decide in advance how much rent will be used in the Housing Benefit calculation.
Changes to the Local Housing Allowance rates
Find out the new rates from April 2017
The rates set in April 2017 will be used throughout the following 52 weeks.
Housing Benefit is calculated on a weekly basis - a monthly paid rent is converted to a weekly figure by multiplying by 12 months and dividing by 52 weeks.
Local Housing Allowance (LHA) monthly figures are converted to weekly by multiplying by 12 months, dividing by 365 days and then multiplying by 7 days.
This means that the weekly figure we use to calculate Housing Benefit is different to the weekly LHA rate. Housing Benefit is restricted to the maximum eligible LHA rate that applies to the customer, so there may be a small shortfall.
example; Rent charged is £752.07 per calendar month
Housing Benefit would calculate the weekly liability to be £752.07 x 12/52 = £173.55
The LHA weekly rate used in the Housing Benefit calculation would be £752.07 x 12/365 x 7 = £173.08
If the customer qualified for maximum Housing Benefit they would be paid £173.08 every 4 weeks x 13 payments = £9000.16
The Customer would be charged £752.07 x 12 = £9024.84
This leaves a £24.68 shortfall for the customer to pay.
You can use the Local Housing Allowance Calculator (MS Excel, 5MB) to work out the amount of rent we could use based on the size of your household and where your property is located.