The things you own may affect your entitlement to Housing Benefit (HB) or Council Tax Support (CTS).

There are limits to the amount of investments or savings that you or your partner can have and still be able to get HB or CTS. Savings and investments include any money or property held, but not your current or future home or personal possessions.

The rules for claimants and partners aged 60 or over are different from those for people aged under 60.

Some savings and investments can be disregarded in the calculation of HB or CTS.

In this section

Savings and investments we need to know about when you claim

Any of the following will need to be declared when claiming HB or CTS:

  • savings;
  • cash;
  • property (except the claimant's current or future home);
  • investments;
  • money received from life insurance policies, trust funds, compensation and injury payments.

Savings and investments that are ignored

The rules allow for certain types of savings and investments to be disregarded. For example, if a claimant owns another property where a relative of the claimant is living is disregarded and that relative is aged 60 or over and is incapacitated, the value of that property is disregarded when assessing capital and savings.

We still need to know about the savings and investments that might be disregarded so please make sure you tell us about them if you claim.

Valuing savings and investments

Savings are taken at face value.

Where a claimant or their partner holds property, shares or anything else that needs to be valued there are rules regarding how these are valued. Generally there are three steps to this process:

  1. take the current market or surrender value of the investment item
  2. then disregard 10% of that value if selling it would involve costs
  3. then disregard any mortgage or loan secured on it

The market value of property is assessed by the Valuation Office Agency and Merton applies to them for a valuation to be done.

National Savings Certificates are valued according to figures given to us by the Government each year not the purchase amount.

Jointly held savings and investments

The following rule applies when an item (e.g. a property) is held jointly by two or more people and are not held in distinct known shares (e.g. one person is shown to hold 40% share and another holds a 60% share)

  1. assume that all the joint owners own an equal share in the item
  2. then value the person's resulting assumed share and count that as their investment.

Notional savings and investments

In certain circumstances a claimant or their partner will be treated as possessing savings and investments that they do not in fact possess. This is known as notional capital and will be included in the assessment of HB and CTS entitlement.

Where we believe that a claimant or partner have deliberately deprived themselves of capital  to qualify for HB or CTS, we will still include this amount in our assessment of HB or CTS. We must take into account the reasons why the money was spent and where the claimant is aged 60 or over we will never apply notional capital rules if the money has been spent on reducing debt or purchasing goods or services that are reasonable given their circumstances. For example, if a claimant aged 65 bought a new washing machine to replace and old one this would not be used as notional capital.

Savings and investments belonging to other household members

The savings and investments of the people that are included in your claim is used to assess your HB and CTS entitlement. We will include the income from their savings and investments.


How we use savings and investments to calculate HB and CTS entitlement depends on your circumstances and the claim you are making. Generally speaking the amount of savings and investments you have are used to calculate an assumed income. This is called tariff income. Details of how this is calculated is shown below. Tariff income from savings and investments in not an exact calculation of the income you get from them. It is an amount decided by the Government that we must include in the calculation of your HB or CTS.

Claimants on Income Support, income based Jobseeker's Allowance, income based Employment and Support Allowance, Pension Guarantee Credit

We disregard all savings, capital and income of people claiming these benefits. This assumes that these have been declared to the Department of Work and Pensions (DWP). Claimants must ensure that they declare all savings and capital to the DWP when claiming these benefits. Failure to do can may result in prosecution.

Claimants over State Pension age

The first £10,000 of savings and investments value is not taken into account when calculating HB or CTS.

We will include a tariff income of £1 for every £500 of savings and capital above this amount (up to a limit of £16,000). If you have more than £16,000 you will not be entitled to HB or CTS. Use the State Pension calculator to work out what age this is for you.

Claimants under State Pension age

The first £6,000 of savings and investments value is not taken into account when calculating HB or CTS. If you are in a residential home this increases to £10,000.

We will include a tariff income of £1 for every £250 of savings and investments above this amount (up to a limit of £16,000). If you have more than £16,000 you will not be entitled to HB or CTS.

Second adult rebate

The savings and investments of the claimant is not taken into account and this is not required to be declared. The savings and investments of the other adults in the property are used as detailed below.

Other household members

The actual income from the savings and investments that other household members have is included in their overall income. This includes interest and dividends.

See also

Contact us

Merton Benefits Service
PO Box 610
Merton Civic Centre
London Road

Telephone: 020 8274 4903