Bedroom Tax Calculator

The 14% Penalty: Why Your “Spare” Room is Costing You a Fortune

In the private sector, a spare bedroom is a luxury. It’s a guest room, a home office, or a walk-in wardrobe.

In the social housing sector, a spare bedroom is a liability.

Officially known as the Removal of the Spare Room Subsidy (RSRS), but universally hated as the “Bedroom Tax,”this policy affects hundreds of thousands of social housing tenants across the UK. It is a blunt instrument designed to free up housing stock, but for many, it simply creates a debt trap.

For Housing Associations and portfolio investors in the social sector, this tax is the single biggest threat to rental yield stability. If your tenant has a room the government deems “unnecessary,” their Housing Benefit is slashed instantly. The shortfall is theirs to pay. If they can’t pay it, arrears build up, and eviction looms.

We built the Bedroom Tax Calculator (above) to visualize this financial penalty. Whether you are a tenant checking your liability or a housing officer assessing portfolio risk, this tool provides the cold, hard numbers.

What is the Bedroom Tax?

The rules are simple but brutal. If you are of working age and rent from a Council or Housing Association, your Housing Benefit (or Universal Credit Housing Element) is cut if you have more bedrooms than the government says you need.

• 1 Spare Bedroom: 14% cut in eligible rent.
• 2+ Spare Bedrooms: 25% cut in eligible rent.

The “Sharing” Trap: The controversy lies in the definition of a “spare” room.

• Two children under 10? The government says they must share a room. If you give them separate rooms in a 3-bed house, that third room is “spare,” and you get taxed 14%.
• Two children of the same gender under 16? They must share. Separate rooms = Tax.

How to Use the Calculator

This tool acts as a “Liability Audit” for any social tenancy.

Step 1: The Rent Roll (Tab 1) Enter the full weekly rent (including eligible service charges).

• Note: Do not deduct anything yet. Put in the gross amount.
• Select the number of bedrooms in the property.

Step 2: The Headcount (Tab 2) This is where the calculation gets smart.

• Select the tenant type (Single/Couple).
• Pensioner Exemption: If you select “Pension Age,” the calculator immediately zeros out the tax. Pensioners are exempt.
• The Kids: Select your children configuration. Watch how the calculator determines “Required Rooms.”

Step 3: The “Hidden” Exemptions Does a child have a severe disability that prevents them from sharing? Does a non-resident carer stay overnight? Select these in the “Exemptions” dropdown. These valid reasons add a “Required Room” back to your entitlement, potentially erasing the tax.

Why Investors Need This Tool

If you are investing in Social Housing (e.g., leasing properties to Housing Associations or REITs), you rely on the government-backed income stream.

The Bedroom Tax breaks that guarantee.

If you lease a 3-bedroom property to a Housing Association, and they place a single mother with one child in it, that property effectively has 1 spare bedroom.

• The government will pay 86% of the rent.
• The tenant must find the remaining 14%.

If the rent is £150/week, the tenant must find roughly £21/week (£1,092/year) from their unemployment benefits. Statistically, this shortfall leads to high arrears. Use this calculator to stress-test your tenant placement strategy.

The Verdict

The Bedroom Tax is a mathematical reality of the UK welfare state. It turns space into debt.

Don’t guess your liability. Use the calculator above to see exactly how much that “spare” room is costing you.