What is the bedroom tax (under-occupation penalty) and how much does it reduce Housing Benefit or Universal Credit?

Full answer

The bedroom tax -- officially called the Removal of the Spare Room Subsidy, or the under-occupation penalty -- is a reduction applied to the housing costs element of Universal Credit, or to Housing Benefit, for working-age tenants in social housing (council or housing association properties) whose home has more bedrooms than the government's size criteria say they need. It does not apply to pension-age households, and it does not apply to tenants in the private rented sector, who are instead subject to a different set of rules (the Local Housing Allowance) that already limits support based on household size. Under the size criteria, a household is allowed one bedroom for each of the following: a couple, any other person aged 16 or over, two children of the same sex under 16, two children of either sex under 10, and any other child. If the property has one bedroom more than this calculated need, the housing element is reduced by 14%; if it has two or more bedrooms more than needed, the reduction is 25% -- these percentages have remained unchanged since the policy was introduced in April 2013 and are applied directly to the eligible rent used to calculate the housing element, not to total household income. For example, a single working-age tenant living alone in a two-bedroom council property (needing only one bedroom under the criteria) would have one spare bedroom, triggering a 14% reduction in their housing support; if the same tenant lived in a three-bedroom property, they would have two spare bedrooms and face the larger 25% reduction. Certain groups are exempt or receive special consideration, including some disabled tenants who need an extra bedroom for a non-resident overnight carer, and some households can apply for Discretionary Housing Payments from their local council to help cover the shortfall, though these payments are not guaranteed and are awarded at the council's discretion based on available funding. The bedroom tax has remained one of the most consistently debated welfare policies since its introduction, with critics arguing it unfairly penalises tenants in areas where smaller properties are simply not available to downsize into.

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