The various weekly social welfare payments can be broadly divided into two main categories, social insurance payments and means-tested social assistance payments. As social insurance payments are not subject to a means test, any income a claimant may have, including income from renting out a room, would not affect their entitlement to payment.
In the case of the social assistance payments, provision already exists to cater for pensioners who rent out a room in their home. For example, in the case of the old age and widow/er's, non-contributory, pension schemes any income received in respect of rent from a person who lives with the pensioner is disregarded for means test purposes where, apart from that person, the pensioner lives alone. In the case of an old age pensioner couple, only half of any income which they have is assessed for means test purposes.
In addition, in the case of the carer's allowance scheme a single claimant can have weekly income of up to £75 disregarded for means test purposes, while a couple can have up to £150 disregarded.
These weekly amounts, which apply to all income, including rental income, are being increased to £125 and £250 respectively, with effect from April 2001.