Ask CPAG Online - when can the two-child limit apply and how is your benefit affected?

This section looks at when the two-child limit can apply and how that affects your benefit entitlement. It also looks at when the two-child limit can stop applying to you.

When can the two-child limit apply?

The two-child limit can apply if:

  • you have three or more children in your family, and
  • you are claiming universal credit or child tax credit, or housing benefit, or (where you have amounts for children included) income support or income-based jobseeker’s allowance, and
  • your third or subsequent child was (usually) born on or after 6 April 2017, and
  • no exception applies regarding that child.

The two-child limit was introduced from 6 April 2017. It did not apply before that date.

The main rules introducing the two-child limit into universal credit (as well as housing benefit, income support and income-based jobseeker’s allowance) are the Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017. The main rules introducing the two-child limit into child tax credit are the Child Tax Credit (Amendment) Regulations 2017.

The limit can only apply regarding a third or subsequent child in your family. So for example, from 6 April 2017 if you already have two children and then give birth to a new child, the two-child limit will apply regarding that child unless an exception applies.

Under the rules, the order of children in your family (i.e., whether a child counts as the first, second, third, etc.) is usually determined by their date of birth. Where neither you nor your partner are the child’s parent or step-parent (for example, you have adopted them), the date you became responsible for them is what is taken into account. The children are then numbered chronologically by date, starting with the oldest. The rule for this is in regulation 2 of the Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017.

The children in your family includes the children of your partner. So, although the two-child limit will not apply where you only have one or two children in your family, if you form a new family with someone with children of their own, the total number of children in your new family could mean that the two-child limit applies. Whether the limit actually does apply will depend on the particular rules regarding the benefit concerned and whether or not an exception applies.

Example

Jane has two children aged 5 and 6. She meets Tom, who has one child, Jake, who was born on 7 April 2017. They become a couple with their children living with them. The number of children in Jane and Tom’s new family is three. The two-child limit could apply regarding Jake, the youngest of the children and who therefore counts as the third child.

Does the two-child limit apply?

1. Do you have three or more children in your family?

No – the two-child limit does not apply. It may apply if another child becomes part of your family.

Yes – go to Question 2.

 2. Are you claiming universal credit, child tax credit or housing benefit?

No – the two-child limit will not apply to you, unless you are one of the few claimants getting child amounts in income support or income-based jobseeker’s allowance (see How does the two-child limit apply to income support and jobseeker’s allowance?).

Yes – go to Question 3.

 3. Do you have a third or subsequent child who was born on or after 6 April 2017?

No – the two-child limit usually will not apply to your universal credit, child tax credit or housing benefit, but may in certain circumstances (see How does the two-child limit apply to universal credit?How does the two-child limit apply to child tax credit? or How does the two-child limit apply to housing benefit?). The limit may apply if another child becomes part of your family.

Yes – go to Question 4.

 4. Do any of the exceptions apply to that child? (see What are the exceptions?)

No – the two-child limit will apply regarding that child.

Yes – the two-child limit will not apply regarding that child.

How is your benefit affected?

If the two-child limit applies regarding a child, then unless an exception applies you will not get a child element for them in your universal credit or child tax credit. Also you will not get a personal allowance for them in your housing benefit or (where you could otherwise still get them) income support or income-based jobseeker’s allowance.

Not getting a child element or personal allowance for a child represents a serious restriction on your benefit – around £2,780 a year or £232 per month. The money is not deducted from the benefit paid to you, but is not included in your benefit in the way that it is for a first or second child.

However, the two-child limit generally does not affect your other benefit entitlement. So for example, if your third or subsequent child is disabled, you can still get personal independence payment for them and have an additional amount included for them in your benefit, even if you do not get the child element or personal allowance for them. Benefits and benefit matters not affected by the two-child limit include:

  • child benefit
  • disability living allowance and personal independence payment
  • increases in your benefit for a disabled child
  • childcare costs
  • size criteria for help with housing costs, and the children taken into account when apply the ‘bedroom tax’ to your universal credit or housing benefit

When does the two-child limit stop applying?

The two-child limit can stop applying to your benefit. The main reason for this is it because it can only apply where there are three or more children in your family. So if the number of children in your family decreases, for whatever reason, so that you now only have two or fewer children in your family, the two-child limit cannot apply.

Example

Joan had three children in her family. Two were born before 6 April 2017 and were already included in Joan’s award of child tax credit. The two-child limit applied to Joan’s youngest child, Bobby, who was born on 28 April 2017. But in October 2017 Joan’s oldest child, Darren, turns 20 and no longer counts as her child. Joan now only has two children in her family. Therefore the two-child limit no longer applies and Joan gets child elements for both of her children, including Bobby.