Guidance on the use of HB Calculator and Local Income Schemes

The Benefit Calculator determines the amount of Housing Benefit and the amount of Council Tax the applicant should expect.

Housing Benefit Calculation:

We go through the following steps for this calculation:

Determine the applicant's income (not counting any disregards, such as certain benefits)
Determine the applicant's rent (not counting any deductions, such as for other residents)
Check their total assets are under the maximum eligibility limit
Determine eligible rent for HB (total rent, less deductions, reduced scaling with income)
Floor rent if value is lower than minimum amount

Council Tax Calculation:

There are two possible paths for this calculation, depending on config. This is the default:

Determine income as above
Determine council tax band
Check their total assets are under the maximum eligibility limit
Determine any reductions in council tax value (such as single person discount)
Determine eligible Ctax Reduction (total ctax, less reductions, reduced scaling with income)
Floor ctax reduction if value is lower than minimum amount

There is a secondary banded option for Council Tax discount. This effectively removes step 5, and instead adds an additional reduction on to the council tax value which scales with income and with other factors. This is the banded version ("LCTD") workflow:

Determine income as above
Determine council tax band
Check total assets are under max eligibility limit
Determine weekly income, disregarding an amount of income for other criteria matched
Determine living situation (Single, Lone Parent, Couple w/o children, Couple w/ children)
Select discount percentage based on income and living situation (and ctax band, optionally)
Apply discount percentage to total council tax bill
Floor ctax reduction if value is lower than minimum amount

This is all highly configurable - on a per-council basis we can modify the values used for the calculation in ways including:

Council Tax band values, including band cap (so Band E-H properties are treated as D, for example)
Income amount per person before eligibility begins to decrease, for adult / pensioner / couple / lone parent / etc
Income per child before eligibility decreases
Additional disregards for disabled adults / children
Disregards for working hours and amounts
Additional disregards for underoccupancy, rent from boarders, child minder costs
Capital limits for shares, property, capital
CTB single person discount and vacant property discount
Reductions for working non-dependants
LCTD minimum and maximum weekly incomes for each discount percentage band and each living situation
LCTD disregards for earnings, disabilities, non-dependants, children, components of Universal Credit to include
Option to force 100% council tax discount for lone parents, disabled, carers, or parents of disabled children
Option to force universal credit claimants to claim CTB only

LCTD Calculator Settings:

UseLCTSDiscountCalculation - this determines whether or not to do a discount mode calculation instead of a standard one

LCTD_SelfEmploymentAsMinWageCutoff - this is the number of days someone must have been self employed for before we round their income up to minimum wage values

LCTD_MinimumHours - this is the number of hours per week we use for the income calculation of self employment at minimum wage

LCTD_MinimumWage - this is the minimum wage we use when rounding self employed income as above

LCTD_IncludeCarersAllowance - if 'true' we include carers allowance income in the weekly income when determining income band

DIsabilityDisregardNonStackable - if 'true' we only include the disability disregard once regardless of the number of disabled people in the household

LCTD_UCExclude[component] - it 'true' we do not include the associated part of the applicant's Universla Credit income in their weekly income for determining discount band

[circumstance]100PercentLiability - if 'true', we override the discount band and always set it to 100% in the appropriate circumstance

LCTDCalculationNetIncome - if 'true' we use net income value rather than gross for weekly income when determining discount band

NonDepDisregardByIncome - if 'true' we use three bands for non-dep income with associated disregard values, rather than a single flat value per non-dependant

LCTD calculator config in rates and values xml file:

CouncilTaxBandCap - if ctax band is higher than this value, we use this value instead

SingleAdultEarningsDisregard - amount of weekly income to disregard for a single adult
CoupleEarningsDisregard - amount of weekly income to disregard for a couple
LoneParentEarningsDisregard - amount of weekly income to disregard for a lone parent
DisabilityDisregard - no longer in use
NonDependantDisregard - disregard for a non-dep if not disregarding by income
ChildBeyondSecondDisregard - disregard for the third and subsequent children - first and second child are included in band values below
ChildCareSingleChildDisregard - amount of weekly child care costs we disregard for single child (so if they pay £200 per week for childcare and this is set to £150, we disregard £150 of their income)
ChildCareMultipleChildrenDisregard - as above but for scenarios with multiple children
MinimumWageAmount and MinimumWageHours - these are no longer used in favour of the settings
CareLeaverBand1Liability - if the applicant is a care leaver and in band 1, we use this value instead of the value in the config:

<Type>SingleAdult</Type>

</Details>

These are the values we use for the calculation once disregards are applied. In the example above, if a single adult has a weekly income between 0 and £75, we apply an 85% discount to council tax.

ChildDisabilityDisregard - disregard for disabled children

SingleAdultDisabilityDisregard, LoneParentDisabilityDisregard, CoupleDisabilityDisregard - disregard for disabilities in the relevant living scenario
SingleAdultDisabilityDisregardEnhanced, SingleAdultDisabilityDisregardSevere, etc - as above but for higher levels of disability
CarersAllowanceDisregard - disregard for person getting carers allowance
WorkingHoursDisregard - disregard for people working over X hours
WorkingHoursRequirementDisabled - number of hours worked needed to qualify for above disregard if disabled
WorkingHoursRequirementLoneParent, WorkingHoursRequirementOver60 - number of hours worked needed to qualify if in these scenarios
WorkingHoursRequirementParentCouplesIndividual, WorkingHoursRequirementParentCouplesTotal - for couples, one member needs to work more than the Individual value and the combined hours worked need to be greater than the total for the discount to apply
WorkingHoursRequirementDefault - value for working hours to use if none of the above qualify (i.e. Not couple, not disabled, not parent)
ChildDisregardMaximum - cap for number of children to disregard for (0 means no cap)
LCTDNonDepDeductionBand1Value, etc - amount to deduct for nondeps in this income band
LCTDNonDepDeductionBand1Cap, etc - maximum income for this band. Band1 is incomes below band1cap, band2 is incomes below band2cap, band3 is anything above that
BypassApplicableAmounts - if true, we don't also take applicable amount income caps into consideration for benefit paid out