Welfare reform for private landlords
The way that private tenants receive benefits is changing – here’s a simple guide to welfare reform for private landlords. You can find out more about Local Housing Allowance rules so you know how the system works.
Local housing allowance for under 35s
Private tenants who are single and under 35 will get the ‘shared accommodation rate of local housing allowance (LHA). Before 1 January 2012 this rate only applied to under 25s. The local housing allowance rate for each area is available from the Scottish Government. If you’re aware of a tenant who is having difficulty paying their rent, then they may be able to apply for a Discretionary Housing Payment from their local council.
‘Bedroom tax’ does not affect private tenants
Local housing allowance - rates updated each April
- the 30th percentile on the list of rents (based on data about rents in this area collected over the previous 12 months), or
- the existing LHA rate plus 1 per cent.
A cap on benefits
From July 2013 a cap on benefits was applied across Scotland.
- For single people with no dependents the cap is £350 per week
- For everyone else the cap is £500 per week.
Universal credit is a new way of paying benefits. It is gradually being introduced across the country with implementation due to finish by the end of 2017. It will eventually replace local housing allowance, combining it with other benefits. Payments will be made directly into claimants’ bank accounts at the end of every month.
Universal credit will replace:
- housing benefit (which includes local housing allowance)
- income-based jobseeker’s allowance
- income-related employment and support allowance
- income support
- child tax credits
- working tax credits.