How new rules let you earn more without losing Housing Benefit in supported or temporary housing

If you live in supported or temporary accommodation and claim Housing Benefit, new rules from October 2026 mean you can earn more before your benefit is cut. Here is what is changing and what it means for you.

What is changing?

From 5 October 2026, the rules about how earnings affect Housing Benefit will change for people in supported housing and temporary accommodation.

Under the old rules, earning even a small amount could trigger a sharp reduction in Housing Benefit. That made taking a job or extra shifts feel risky — you could end up worse off overall.

From October, some of your earnings will be completely ignored when the council works out your Housing Benefit. This is called an earned income disregard. The approach is similar to the work allowance that Universal Credit already uses.

Who does this apply to?

The change is for working-age people who:

• live in supported accommodation or temporary accommodation, and
• claim Housing Benefit (not Universal Credit) to help cover their rent

Supported accommodation includes places such as hostels, women's refuges, sheltered accommodation, and housing schemes for people with disabilities or mental health needs.

Temporary accommodation is housing your council places you in while you wait for a longer-term home. This includes bed and breakfasts, short-term flats, and other placements arranged by a local authority.

The new rules will affect around 315,000 people across England, Scotland, and Wales.

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What does it mean for you?

Before October 2026, taking on a job or increasing your hours could lead to a steep cut in Housing Benefit. The current calculation does not ignore much of what you earn.

From 5 October, some of your pay will not count at all when your Housing Benefit is recalculated. How much is ignored depends on your age and whether you are single or in a couple. The amounts will be reviewed and updated each year.

The government confirmed that no one will be made worse off by the change.

What you can do now

If you live in supported or temporary housing and are thinking about starting work:

• Talk to your housing support worker or key worker. They can explain how your Housing Benefit is currently calculated and what will change from October.
• Contact Citizens Advice for free, confidential advice on how your specific situation will be affected. You can find your nearest office at citizensadvice.org.uk.
• Check with your council's Housing Benefit team — they can confirm when the new disregards will be applied to your claim.

If you are already working, watch for a letter from your council after 5 October. Your council should update your claim automatically to apply the new disregards.