Abating cap
If the client's rate of Income Related Rent is greater than what they were paying as rent before the change and they were not receiving Tenure Protection Allowance or Special Transfer Allowance then they are eligible for an abating cap.
The cap is calculated as the difference between the Income Related Rent the client would have been charged on 1 December 2000, and the net rent they were paying.
When a client is eligible for an abating cap, the cap amount reduces by $5 per week at each review of Income Related Rent if the cap has not already been reduced in the 12 months prior to the review.
Example of abating cap
Rent payable before 1 December 2000 | $140 |
Accommodation Supplement | $42 |
Net rent on 1 December 2000 | $98 = A |
Income Related Rent calculated on 1 December | $180 = B |
Cap (discount) (= B - A) | $82 = C |
Abatement as at December 2014 (= $5 x 14 years) | $70 = D |
Abated cap as at December 2014 (= C - D) | $12 = E |
Cumulative Rent (= A + D) | $168 = F |
Calculated rate of Income Related Rent on 14 April 2023 | $200 = G |
Rent charged as at 14 April 2023 (lesser of F and G) | $168 |
Example 2 abating cap
Rent payable before 1 December 2000 | $140 |
Accommodation Supplement | $42 |
Net rent on 1 December 2000 | $98 = A |
Income Related Rent calculated on 1 December | $250 = B |
Cap (discount) (= B - A) | $152= C |
Abatement as at December 2014 (= $5 x 14 years) | $70 = D |
Abated cap as at December 2014 (= C - D) | $82 = E |
Cumulative Rent (= A + D) | $168 = F |
Calculated rate of Income Related Rent on 14 April 2023 | $150 = G |
Rent charged as at 14 April 2023 (lesser of F and G) | $150 |
