What happens if my rent is cheaper than the housing benefit rates?
If you were claiming local housing allowance (LHA) before 1st April 2011, and your rent was cheaper than the LHA rate paid to you, you were allowed to keep the difference up to £15 a week. This difference was referred to as the 'excess payment'.
With the Government changing many things with the housing benefit system, from April 2011, you will lose this 'excess payment' when your claim is reviewed or if your household circumstances change.
For new claims made after 1 April 2011, you will not receive this ‘excess payment’. The maximum that you will receive in housing benefit will be the current LHA rates for your area when you take on the tenancy or nine months after the anniversary of your claim, or sooner if your household circumstances change.
If the LHA rate is higher than your current rent you will not receive the difference.