How is benefit calculated?
If you get Income Support / Job Seekers Allowance (Income Based) / Employment and Support Allowance (Income Related) or Pension Guarantee Credit
You will get the full amount of your Council Tax after any non-dependant deductions have been applied to the calculation of your benefit.
If you do not get Income Support / Job Seekers Allowance (Income Based) / Employment and Support Allowance (Income Related) or Pension Guarantee Credit
We work out your Council Tax Benefit by comparing the money you get each week with your 'Applicable Amount'.
Your applicable amount is what the government says you and your family need to live on each week.
The applicable amount will be higher for some people - for example, if you are a pensioner, disabled or you are a one-parent family.
If your weekly income is less than, or the same as your Applicable Amount, you will get the full amount of Council Tax Benefit. If this happens you should claim Income Support as you may get more help.
If your weekly income is more than your Applicable Amount (this income over your Applicable Amount is called "Excess Income") then the amount of Council Tax Benefit you are entitled to receive will be equal to the weekly Council Tax less 20% of the weekly Excess Income figure and less any non-dependant deductions.
How is my weekly income calculated?
We count the money that you and your partner earn from work after money has been taken out for Tax, National Insurance and half of any money paid into a pension fund.
To this figure we add any other income that you might have. For example state retirement pension, a pension from a former employer, tax credits or other state benefits.
Somes types of income are disregarded and are not taken into account eg Disability Living Allowance, Attendance Allowance and Child Benefit. Even though they are not taken into account it is still important that you tell us about them.
A Tariff Income may also be calculated from any capital / savings that you or your partner have and this is added to the above figures. Please see the 'What counts as Capital and how does it affect my Benefit?' section below for more information on Tariff Income.
For the purposes of working out your benefit your weekly income is the total of any earned income, unearned income and tariff income as detailed above.
What counts as capital and how does it affect my benefit?
For Council Tax Benefit purposes most savings, investments and assets owned by you and your partner are treated as 'capital' and examples of the most likely sources are:
- cash savings.
- current accounts (even if you only use it to get things paid into it like wages or a pension or you just use it to pay bills).
- money in a bank, post office or building society account.
- money in savings schemes.
- National Savings Certificates.
- Premium Bonds
- stocks and shares, bonds and other investments.
- property or land.
The following do not count as capital:
- personal possessions.
- certain business assets, if you are still working in the business.
- surrender values of Life Policies.
- sale proceeds of your home (for up to six months if you intend to purchase another home).
- money from insurance claims in respect of loss or damage to home or personal possessions (for up to six months if used to replace or repair).
- any Social Fund payment.
The above lists are not exhaustive and enquiries should be made to clarify the situation if you are doubtful about any asset or interest you have.
How your Capital Tariff is calculated
Once we have worked out what your capital amounts to, Government rules say that if you (and your partner if you are a couple) have savings or capital of more than £16,000, you cannot get Council Tax Benefit.
If you (and your partner if you are a couple) have £6,000 or less it will not affect your claim. If you are 60 or over this figure is £10,000.
If you or your partner are aged 60 or over and have between £10,000 and £16,000, it affects how much Council Tax Benefit you will get. For every £500 (or part of £500) you have over £10,000 we add £1.00 to the money we count each week when working out your benefit.
If you and your partner are aged under 60 and have between £6,000 and £16,000, it affects how much Council Tax Benefit you will get. For every £250 (or part of £250) you have over £6,000 we add £1.00 to the money we count each week when working out your benefit.
This money that is counted from your capital is called Tariff Income.
We do not count any actual interest you get from savings and capital.
Note: For Second Adult Rebate (Council Tax Alternative Benefit) the Capital Tariff does not apply. The actual interest received by the second adult is counted instead.
What is an applicable amount?
This is a weekly figure set, usually annually, by the Government and represents the basic living needs of the claimant and family.
An applicable amount is made up of:
- a claimant's personal allowance.
- personal allowances for a partner and / or dependant children.
- premiums - for example, a family premium or disability premium.
If your weekly income is less than, or the same as your Applicable Amount, you will get the full amount of Council Tax Benefit. If this happens you should claim Income Support as you may get more help.
If your weekly income is more than your Applicable Amount (any income over your Applicable Amount is called "Excess Income") then you are entitled to receive Council Tax Benefit equal to the weekly Council Tax less 20% of the weekly Excess Income figure and less any non-dependant deductions.
What if there is a shortfall between the amounts of benefit awarded and the full Council Tax?
Anyone receiving Council Tax Benefit where there is a shortfall between the amount of Council Tax payable and the amount of Council Tax Benefit awarded can apply for a Discretionary Housing Payment. For more information please see 'Awarding Discretionary Housing Payments'. This does not apply if the shortfall is due to a non-dependant deduction because someone lives with you.
The amount the Council can spend is limited to the amount specified by the Government each year. These payments are not part of the Housing and Council Tax Benefit schemes. To be considered you will need to complete our Application for Discretionary Housing Payments form. See Online Forms if you would like to download a form.
How is Council Tax Benefit paid?
Council Tax Benefit will be credited directly to your Council Tax Account reducing the amount of Council Tax you have to pay.
For further information:
-
Contact: Benefit Team Leader, Town Hall, Penrith CA11 7QF
-
Telephone: 01768 212131
-
Email: benefits@eden.gov.uk
-
Fax: 01768 890470
