Appendix 8: Model Rent and Service Charge Build-Up

Managing Housing Benefit Claims in Supported Housing | Part E: Tools and Appendices

This appendix is a model for setting out how a scheme’s rent and service charges are made up, with a worksheet for apportioning staff time and other mixed costs. It puts Chapter 9 (9.3 and 9.4), Chapter 10 (10.8 and 10.9) and Chapter 13 (13.5) into practice. It has five parts:

  • Part A: scheme details
  • Part B: the build-up
  • Part C: apportionment worksheet for staff and other mixed costs
  • Part D: year-on-year comparison, for rent increases
  • Part E: a worked example, for the shared house used in Appendices 6 and 7

Why a build-up matters. The DWP guidance says councils “should request a rent breakdown from the landlord which sets out all the charges included in the rent and service charges when a new claim or rent increase is submitted” (para 168; also para 196). On an increase, they should compare it with the previous year’s “to identify why the rent has increased and whether it is justifiable” (para 238). A clear build-up answers three questions at once: what is eligible (Chapter 9), whether any eligible charge is excessive (Schedule 1, para 4), and whether the eligible rent as a whole is unreasonably high (Chapter 10).

Status of the model. No particular format is required by law. Providers can use their own format where it gives the same information. Councils and providers can agree a local version of this template, so that both look at the same figures in the same order (Chapter 10, Finding common ground).

Principles.

  • Start from costs. Use actual costs for the last full year, or a budget for a new scheme, and say which.
  • Separate the core rent from service charges. Lease or property costs, repairs, long-term maintenance, general housing management, insurance, voids and bad debts are rent. They are tested as part of the whole under regulation 13, not picked off as ineligible service charges (CH/3528/2006; Chapter 10, 10.9).
  • Identify every service charge and its treatment. Mark each one eligible or ineligible, using Chapter 9 (9.4).
  • Apportion mixed costs by a stated method. Where a cost covers both eligible and ineligible services, apportion it by a reasonable, consistent method, usually staff time (Schedule 1, para 3(1); ET v Rossendale BC [2010] UKUT 222 (AAC), para 39).
  • Apply overheads and allowances pro rata. Where a percentage for overheads or voids is applied to every line, the part that falls on ineligible lines is ineligible too (Allerdale BC v JD and Others [2019] UKUT 304 (AAC), paras 37 and 38).
  • Evidence voids and bad debts. There is no standard percentage. Use the scheme’s actual history (ET v Rossendale, paras 41 to 43).
  • Show the eligible rent. The eligible rent is the core rent plus eligible service charges. Ineligible costs must be shown, with how they are funded.
  • Treat it as commercially sensitive. Councils should hold build-ups in confidence and limit who sees them (Chapter 13, 13.2).

SHP’s position. The build-up should show what the scheme actually costs to run. There is no need to add an ineligible “support charge” to show that support exists. Where personal support is provided, the build-up should apportion its true cost and show how it is funded. Housing-related support and supervision delivered as intensive housing management are eligible (Chapter 3, 3.4; Chapter 9).

Part A: Scheme details

FieldEntry
Scheme name and provider
Addresses, number of units or bedspaces, and type (shared, self-contained, dispersed)
Period covered (financial year) and basis (actual costs or budget)
Occupancy assumption used for the per unit figures
Lease or property arrangement (Appendix 4, A2.2)
Prepared by, role and date

Part B: The build-up

Show each line as an annual cost and a weekly figure per unit. The weekly figure is the annual cost divided by the number of units and 52.

LineItem£ per year£ per unit per weekTreatment
1Core rent
1.1Lease payment or property costs (capital, loan or lease)Rent
1.2Responsive and cyclical repairsRent
1.3Planned maintenance or sinking fund for long-term maintenance (DWP guidance, paras 172 and 173)Rent
1.4General housing managementRent
1.5Buildings insuranceRent
1.6Voids and bad debts (state the basis)Rent
Core rent total
2Eligible service charges
2.1Intensive housing management (from Part C)Eligible
2.2Housing-related support (from Part C)Eligible
2.3Supervision, including on-call cover (from Part C)Eligible
2.4Communal cleaningEligible
2.5Communal fuel, lighting and waterEligible
2.6Furniture and white goods that remain the landlord’sEligible
2.7Door entry, fire alarm and other building servicesEligible
2.8Other eligible services (list)Eligible
2.9Overheads on eligible services (state the basis)Eligible
2.10Voids and bad debts on eligible servicesEligible
Eligible service charges total
Eligible rent (core rent plus eligible service charges)Housing Benefit
3Ineligible costs
3.1Personal support (from Part C)Ineligible
3.2Fuel and water for tenants’ own roomsIneligible
3.3Meals, laundry service, emergency alarm, TV licence and other ineligible items (list)Ineligible
3.4Overheads, voids and bad debts on ineligible costsIneligible
Ineligible costs total

How ineligible costs are funded. For each ineligible line, say whether it is charged to the tenant, funded by a commissioner or grant, or met from the provider’s own funds (DWP guidance, paras 160 to 162).

Part C: Apportionment worksheet

Use this worksheet for every cost that covers more than one type of service, which in most schemes is mainly staff time. It follows the method in ET v Rossendale (para 39): the total cost of employing the staff, apportioned by the time they spend on each service.

C1. Staff costs charged to the scheme

RoleAnnual cost including on-costs (£)Share charged to this scheme, and basis£ to this scheme

C2. How each role’s time is spent

Use the same type codes as Appendices 6 and 7: HRS (housing-related support), IHM (intensive housing management and maintenance), SUP (supervision), CPS (care or personal support), and HM (general housing management). Time on recording, travel and team meetings should be spread across the other activities in proportion, and the method stated.

RoleActivity% of timeTypeTreatment

C3. Result

Activity type% of staff cost£ per yearBuild-up line
HM1.4
IHM2.1
HRS2.2
SUP2.3
CPS3.1

C4. Evidence for the apportionment

The case law expects “sufficiently detailed evidence of the amount of time devoted by staff” to each service (ET v Rossendale, para 20; Chapter 9, 9.3). Keep, and provide on request:

  • job descriptions for each role
  • contracted hours, and how many schemes and tenants each role covers
  • what staff do in the time attributed to each service and in the rest of their time
  • how the percentages were worked out, for example from a time recording sample or the activity logs in Appendix 7
  • the basis for any overhead percentage, such as central costs as a share of total expenditure

Part D: Year-on-year comparison

Complete on every rent increase. Explain each material change (DWP guidance, para 238; Chapter 10, 10.8). The council must judge the increase in cash terms as well as percentage terms, and consider whether a lesser increase would be reasonable (BM; Chapter 10, 10.8).

ItemLast year (£ per unit per week)This year (£ per unit per week)ChangeReason and evidence
Eligible rent

Part E: Worked example

This example is fictional. It is for the five-bedroom shared house for single homeless adults used in Appendices 6 and 7, with weekday visiting staff and 24-hour on-call cover. The figures are set at typical levels, using the published benchmarks below, but they are not a benchmark themselves. Actual costs vary widely by area, property and client group.

E1. Where the figures come from

BenchmarkTypical figureSource
Rent, excluding service charges, single homeless people£178 a week (2022 to 2023)Supported Housing Review 2023, Table 7.3
Service charges, eligible and ineligible, single homeless people£109 a week (2022 to 2023)Supported Housing Review 2023, Table 7.4
Share of rent and service charges eligible for Housing Benefit, single homeless people83%Supported Housing Review 2023, Table 7.5
Average eligible rent, working age, specified accommodation, England£267 a week (November 2023)Supported Housing Review 2023, Table 7.6, from DWP data
Property cost per tenant in a shared house£100 a week (£1,300 a month for a three-bedroom house, 2022)Bristol City Council, EXA 115
Line-by-line enhanced exempt rent£218.49 a week, including voids £15.05, staffing £56.10, communal cleaning £14.88 and communal lighting and heating £5.92 (2022)Bristol City Council, EXA 115

The example uprates the Bristol property cost to £115 a week to allow for inflation and a larger house. Its totals sit close to the review’s figures: core rent £171.39, all service charges £129.16, eligible rent £257.54, and 86% of the total charge eligible.

E2. Scheme details

FieldEntry
SchemeFive-bedroom shared house for single homeless adults, let by a not-for-profit provider
Period and basisFinancial year, actual costs for the last full year
Occupancy assumptionFive units, 52 weeks. Voids and bad debts shown as a separate allowance
LeaseTen-year full repairing and insuring lease from a private owner at £2,492 a month, with an annual CPI-linked uplift
UtilitiesAll utilities included in the charge. Split between communal areas and tenants’ own rooms by floor area

E3. Apportionment worksheet

RoleAnnual cost including on-costs (£)Share charged to this scheme, and basis£ to this scheme
Support worker32,000One third: covers three houses, 15 tenants10,667
Housing officer31,000One sixth: covers six houses, 30 tenants5,167
On-call rota18,000One twelfth: covers 60 units1,500
RoleActivity% of timeTypeTreatment
Support workerTenancy sustainment, rent account checks, help with Housing Benefit, move-on planning50HRSEligible
Support workerHouse checks, visitor and dispute interventions, welfare checks30SUPEligible
Support workerEmotional support and living skills20CPSIneligible
Housing officerRoom and fire safety checks, hazard plans, repairs arranged around tenants’ needs60IHMEligible
Housing officerLettings, rent collection and general tenancy management40HMRent
On-call rotaOut-of-hours cover and call-outs100SUPEligible

The support worker’s percentages are after spreading recording and travel time across the other activities in proportion. The 20% for personal support matches about 30 minutes a week for each tenant in Appendix 6.

E4. The build-up

LineItem£ per year£ per unit per weekTreatment
1Core rent
1.1Lease payment to owner (full repairing and insuring, CPI-linked)29,900115.00Rent
1.2Responsive and cyclical repairs3,12012.00Rent
1.3Planned maintenance provision (long-term maintenance)1,5606.00Rent
1.4General housing management: housing officer 40% (£2,067) and central lettings and rent collection (£2,600)4,66717.95Rent
1.5Buildings and contents insurance6502.50Rent
1.6Council tax, where the landlord is liable for a shared house1,3655.25Rent
1.7Voids and bad debts: 8% of lines 1.1 to 1.6 (actual: voids 7%, bad debts 1%, average of last two years)3,30112.70Rent
Core rent total44,563171.39
2Eligible service charges
2.1Intensive housing management: housing officer 60%3,10011.92Eligible
2.2Housing-related support: support worker 50%5,33320.51Eligible
2.3Supervision, house checks and interventions: support worker 30%3,20012.31Eligible
2.4Supervision, 24-hour on-call: rota share1,5005.77Eligible
2.5Communal cleaning2,0808.00Eligible
2.6Communal fuel, lighting and water: communal share of utilities, by floor area1,5606.00Eligible
2.7Furniture and white goods (remain the landlord’s)1,4305.50Eligible
2.8Fire alarm, emergency lighting and door entry maintenance6502.50Eligible
2.9Central overheads: 10% of lines 2.1 to 2.81,8857.25Eligible
2.10Voids and bad debts: 8% of lines 2.1 to 2.91,6596.38Eligible
Eligible service charges total22,39886.15
Eligible rent (core rent plus eligible service charges)66,960257.54Housing Benefit
3Ineligible costs
3.1Personal support: support worker 20%2,1338.21Ineligible
3.2Fuel and water for tenants’ own rooms: remaining share of utilities, by floor area7,28028.00Ineligible
3.3Central overheads: 10% of lines 3.1 and 3.29413.62Ineligible
3.4Voids and bad debts: 8% of lines 3.1 to 3.38283.19Ineligible
Ineligible costs total11,18343.01

How the ineligible costs are funded. The personal support (line 3.1, with its share of overheads and voids, £9.75 a week) is met from the provider’s own funds, such as charitable income or donations, and is not charged to tenants. Fuel and water for tenants’ own rooms (line 3.2, with its share of overheads and voids, £33.26 a week) is charged to each tenant as a personal charge, which Housing Benefit does not cover. Fuel for tenants’ own rooms is an ineligible service charge, deducted in full because it is specified (Schedule 1, Part 2, paras 5 and 6(1)(b)). Water for tenants’ own rooms is deducted under alternative regulation 12(3)(a) and (6)(b), which take off the share of the property’s water charges matching the floor area of the tenant’s own accommodation. The share for halls, passageways and rooms of common use stays in line 2.6 and is eligible (Liverpool City Council v NM and WD [2015] UKUT 532 (AAC), paras 31 and 36 to 38).

What the tenant pays and what Housing Benefit covers. The total weekly charge to each tenant is £290.80: the eligible rent of £257.54 and the personal fuel and water charge of £33.26.

Points to note.

  • The core rent includes voids, long-term maintenance and general housing management. These are rent, not service charges (CH/3528/2006).
  • The 8% allowance for voids and bad debts is based on the scheme’s actual history, not a standard figure (ET v Rossendale, paras 41 to 43). Short-stay homeless schemes often have higher turnover than other supported housing. The Bristol example’s voids line is about 7% of its total.
  • The 10% central overhead is applied to service lines only, and falls pro rata on the ineligible lines (Allerdale, paras 37 and 38). The core rent carries its own management cost in line 1.4.
  • Council tax (line 1.6) is included because the landlord, not the tenants, is liable for a shared house in multiple occupation. DWP’s guidance is that where rent is increased to cover the landlord’s council tax, the increase should be treated as rent and is eligible for Housing Benefit, but the total rent, including the council tax, must still be reasonable (Housing Benefit Guidance Manual, A4, paras 4.160 and 4.161). It should be shown as a separate line so that the council can check it against the council tax bill.
  • The eligible rent is then tested as a whole for reasonableness under regulation 13, against suitable alternative accommodation (Chapter 10).

E5. Year-on-year comparison

ItemLast year (£ per unit per week)This year (£ per unit per week)ChangeReason and evidence
Lease payment (1.1)111.65115.00+3.0%CPI uplift under the lease; lease clause and CPI figure provided
Responsive and cyclical repairs (1.2)11.0012.00+9.1%Higher spend on damage linked to tenants’ needs; repairs log summary (Appendix 7, B1)
Eligible staff costs (2.1 to 2.4)48.5750.51+4.0%Pay award; no change in staffing or time split
Communal fuel, lighting and water (2.6)6.406.00-6.3%Lower energy tariff
Eligible rent250.68257.54+2.7%, £6.86 a weekThe housing officer’s share of line 1.4 also rises with the pay award. All other lines unchanged

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This template is licensed under CC BY 4.0: you can adapt it, with credit to SHP. See Rights and licence. Supported Housing People Ltd, Version 1.0, October 2026.