New Housing Benefit earned income disregards due to come into force

The Housing Benefit (Earned Income Disregards) (Amendment) (No. 2) Regulations 2026 amend the Housing Benefit (Earned Income Disregards) (Amendment) Regulations 2026, which were laid on 6 July 2026 and are due to come into force on 5 October 2026¹. The corrective instrument, numbered 2026 No. 978, extends to England, Wales and Scotland¹. The earlier regulations were made at 9.00 a.m. on 6 July 2026 and laid before Parliament at 3.00 p.m. the same day².

The Department for Work and Pensions says the original regulations contained provisions that would have prevented the policy from operating as intended. It states that, without amendment, they "could exclude lone parents, prevent the disregard from operating as intended for couples, affect its interaction with existing earnings disregard provisions, and impose an unintended minimum-hours requirement through the use of the term 'remunerative work'"¹. The new instrument substitutes a paragraph 18 into Schedule 4 to the Housing Benefit Regulations 2006 so that lone parents are provided for specifically, using the same age categories and amounts as single claimants, and clarifies the amount that applies where a claimant and their partner are both under 18¹.

The disregard amounts set out in the July regulations are unchanged by the corrective instrument¹:

The amendments apply to working-age Housing Benefit only, and no changes are made to the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006². The Department says the substituted paragraph also allows the disregard to be shared between partners: where a claimant has no earnings or earnings below the disregard amount, the partner's earnings may be disregarded up to the applicable amount¹. A claimant in specified or temporary accommodation can qualify where they, or their partner, is an employed or self-employed earner, without a minimum hours requirement¹.

The Department has sent a voluntary memorandum to the Joint Committee on Statutory Instruments explaining and apologising for the errors, and a similar memorandum to the Secondary Legislation Scrutiny Committee¹. No formal public consultation was undertaken because the instrument does not introduce a new policy, and no full impact assessment was prepared because it has no, or no significant, impact on business, charities, voluntary bodies or the public sector¹. The Local Government Association was consulted on 20 August 2026 and was content with the instrument; the Social Security Advisory Committee was notified and did not take the regulations on formal reference¹.

Why it matters for households

The changes affect working-age Housing Benefit claimants who live in specified accommodation or temporary accommodation and who work, or whose partner works. From 5 October 2026, the first £61.41 to £119.70 a week of earnings, depending on age and household type, is disregarded when Housing Benefit entitlement is calculated¹. The Department says the policy intent is that all eligible claimants in these types of accommodation can benefit from the additional disregard, and that the original regulations were intended to strengthen work incentives and reduce the financial cliff-edge faced when earnings reduce a Universal Credit award to zero¹. The independent training provider Housing Rights describes the current system as one where earning anything other than a small amount may cut a claimant off from rent payment through Housing Benefit, compared with the 55% taper and potential work allowance on Universal Credit³. The Department says the amendments do not change the overall policy objective or the level of support intended¹.

What happens next

The corrective instrument is due to come into force in advance of the July regulations so that those regulations come into force as amended on 5 October 2026¹. The Department will publish an adjudication circular providing guidance for local authority staff before the instrument comes into force¹. Housing Rights is running free online sessions on the new disregards on 28 and 29 September 2026³. The instrument does not include a statutory review clause¹.