Universal Credit Housing Costs Element: What is a Universal Credit Housing Costs Element?

The Universal Credit Housing Costs Element is available for most working-age tenants having replaced Housing Benefit. The payment is intended to help with rent costs and is paid directly to renters rather than landlords. Express.co.uk explains what the Housing Costs Element is exactly.

What is Universal Credit?

Universal Credit is a payment intended to help people of working age who are out of work or on a low income.

The benefit replaced six existing legacy benefits, including Income Support, Jobseeker’s Allowance and Housing Benefit.

It is made up of a standard allowance, in addition to other additional elements which are dependent on one’s individual circumstances.

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How much is the Universal Credit Housing Costs Element?

The Housing Costs element for private tenants Universal Credit for 2020/2021is calculated depending on the Local Housing Allowance in your area.

The Local Housing Allowance (LHA) rate is set based on rental prices in your area, as well as the number of rooms you need based on who lives in your household.

If you are single, do not have any dependent children and are aged under 25, you will only be able to get the Shared Accommodation rate of LHA.

This will not apply and you will be entitled to the one-bedroom rate if:

  • You are aged 22 and are a care leaver
  • You receive the daily living component of PIP, the middle or higher care rate of Disability Living Allowance or Armed Forces Independence Payment
  • Or, if you are 25 and over and have been living in a hostel for people who are homeless for three months or more.
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The Housing Costs element for social tenants Universal Credit for 2020/2021 is based upon your eligible rent.

A sizable restriction is applied when calculating your award which means that your eligible rent may not be taken into account in full if it is considered you have more bedrooms than your household actually needs.

You are permitted one bedroom each of the following: each adult couple, each person aged over 16, two children of the same sex under the age of 16, two children under 10, regardless of their sex, any other child or an overnight carer you need, but who does not normally live with you.

If your home is considered to be too large for you, it will be reduced by the following amounts:

  • 14 percent if you have one spare bedroom
  • 25 percent if you have two or more spare bedrooms.

However, some households will be protected from this reduction including foster carers who have had a child placed with them, parents of armed forces personnel while their child is away on duty and parents of a severely disabled child unable to share a room with a sibling.



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