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Unoccupied bedrooms can lead to a limit on the amount of housing benefit

Bedroom Tax: Explained

Secured Loans > Our Loans > Homeowner Loans > Bedroom Tax: Explained

The bedroom tax will affect you if you are a housing association, approved social housing or council tenant of working age who lives in a property with at least one ‘spare’ bedroom.

Unoccupied bedrooms can lead to a limit on the amount of housing benefit you can receive. It’s a reduction officially called an under-occupancy charge but commonly called the bedroom tax.

In simple terms, it means that housing benefit will cover the number of bedrooms an individual or family actually needs, but any extra rooms must be funded independently. There are discretionary housing payments, however, that can pay bedroom tax costs in some circumstances.


Housing benefit will go down by 14 per cent of the total eligible rent if a property has one spare bedroom. This increases to 25 per cent if there are two or more spare rooms. This means that if your rent is £100 but you have two spare rooms, then only £75 would count when housing benefit was assessed. You would have to pay the extra £25 yourself. If you had one extra bedroom, only £86 of the rental figure would be counted, and you would have to top up the additional £14.

Financial Difficulties

You may be entitled to a discretionary payment, so contact your local council. Also ensure that you are receiving all other benefits that you are able to claim.

You may be able to take in a lodger. Home improvement loans are available to help you get a spare room up to scratch if you meet the criteria, and you can keep £20 of income from a lodger before it starts to affect any other benefits you claim.

If you are unable to manage because of the bedroom tax, you could consider exchanging or transferring to a smaller property without a spare room. Secured loans could be used to bridge the gap in the short term, although these are normally not available to people with no property to act as security.


There are exemptions if you and any partner have reached pension credit age, if you are living in a shared-ownership property, a houseboat, caravan or mobile home, or if you are living in particular kinds of supported accommodation. Homeless people housed in council-provided temporary accommodation are also exempt, although they are not if the property is council-owned. If you are unsure if you are exempt, contact your local council for advice.

Number of Rooms

To determine if you have a ‘spare’ room, you must first understand what space people are entitled to in terms of housing benefit. A couple can claim housing benefit for one bedroom, as can a person of 16 years or older. You can claim for one bedroom to accommodate two children who are of the same sex and aged under 16 and a bedroom for any other child. There is also the potential to claim for a bedroom used by an overnight carer.

Approved foster carers can have the room allowance even if they are between placements as long as they have fostered or become approved carers within the last year. Children are generally classed as living with the person who is given their child benefit, and adopted children are counted once there is an adoption order in place. Students’ rooms can be counted if they are not away for more than a year and have the intention of returning home, as can armed forces personnel.

Children with severe disabilities do not have to share if it is determined they need their own room. The benefits received and medical evidence will be considered, along with the impact on another child if they had to share the room.


You may be in line for a refund of bedroom tax due to a tax loophole. This will only apply if you have received housing benefit on a continuous basis for the same property since before January 1st, 1996

Warning: Late payment can cause you serious money problems. For help, go to moneyadviceservice.org.uk

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