Can you claim housing benefit if renting from a relative?

sirmyser

real1314 wrote: »

"...and Neill gb who works for a HB dept. all good contributions here."
Does he? I don't think he does, based on his apparent ignorance to what constitutes fraud.

"I have analysed a few cases, and the outcomes do vary which seems to support real1314 statement about their being no rules in this area."
I've read the Guide to HB and CTB, by Zebedee Ward and Lister. I've been reading it for about 12 years, updated annually of course. And I read the actual regulations now and then. There are no "renting from a relative" rules except for the parent of a child thing.

"then these funds may just serve to service the loan on the property in question."
As they would do on any BTL that i paid through HB/LHA. Why should a relative be barred from this situation? Not sure what the next idea (interest only) is meant to mean?

You can rent a craphole from a dodgy landlord with no problem, but if you rent a decent place from your uncle we all want it stopped? why?
We're "happy" to have the HB paid, the LL relative could rent to a 3rd party who gets HB/LHA and the Tenant relative could rent from the dodgy LL.

As for the rest of it, it's not a bad approach, tell them honestly what the scenario is, that way it's up to them to decide and you can't be done for fruad, but I don't think you really know enough to give advice. For one thing you seem unaware that councils do not set the rules for HB/LHA, as they are set by national government and come under the social security legislation. Councils simply administer the scheme on the behalf of the the DWP, so neil could talk to his boss, but it would do no good.

In many of the cases I've seen on here, if the facts were presented in a particular way, they would be paid, but if they were presented differently they would not. The problem is that the cases that should not be paid could be presented in a way that would lead to them being paid, and giving advice on here on what to say would encourage fraud. It's better for people to be advised to tell the council the situation and let them decide.

And just to illustrate how it can be done:

1. I get a means tested benefit and am allowed to earn £5 a week without it being affected. I work for my brother and he pays me £20, but it's only 1 week in every 4 that I work. So every time I work I lose £15 (after my £5 allowed).

2. I work every week now, but only for £5 a week. I lose nothing.

Firstly, if neill HB posts, it is still an objective point of view - however extreme/ignorant.

as far as knowing enough to give advice, as I said I have been involved in this exact same situation. Single parent, relative, housing benefit. This is in fact is why I am commenting here - irrespective of you and your 12 years of reading.

As for the other comments I made in respect to the politics involved, I was merely opening this up for discussion - as I said, and in no way would I encourage fraud. You seem to agree with me in relation to approaching the council (which I have actually done) and in effect you are just repeating what I have said. Government/council or whatever, (read the original post) the question was regarding eligibility (not who makes up the damn rules). My advice stands (as well as all the side issues worthy of discussion). Maybe you should utilise all your years of 'reading' and give straight advice to the person asking for help/advice instead of 'high horsing it'

and as for the last bit of advice - it will only serve to confuse the person you intend to advise (ego flexing aside). Try to keep it simple, I did and it worked.

reggie1066

So much interesting discussion since I left this thread at 1.00 pm. One good thing to be said for all this heated debate that everybody’s entered into is that it sure takes my mind off the real problem of where I’m going to be living in a few weeks’ time!
Sarahpoppy – I have to apologise for taking umbrage with your earlier post. Reading it through later, I realize that you probably meant to cause no offence, I was just in a panicky state and read you the wrong way. I’m sorry. Meanwhile, you’ve since raised the issue of CSA: I’m afraid Dad doesn’t pay, never has, never will. CSA decided themselves years ago not to pursue him, and I would politely ask that this doesn’t become an object of discussion on the forum. It’s personal and I would like to keep it that way.
I did pick up one of your posts on another thread, where you expressed your views about high costs of private rentals and the lack of secure tenure. We’re in one mind on that, which is one of the reasons I preferred not to live in a commercially rented property. I might not be able to presently afford even the modest rent my brother charges, but at least if I did manage to claim HB he wouldn’t be milking the system of every penny he could charge, plus I do have – or did have - more security of tenure where I am now than I will have renting from another landlord privately.
ISue23 and Only Girl – how did you prove to the authorities that your rental arrangement with your respective children wasn’t a contrived tenancy? Did your children claim HB right from the start, did you have Tenancy Agreements to show, rent books, etc? I would be very grateful to know. Also, I wonder why have you not come under attack from other posters for exploiting the HB system by providing accommodation for close relatives, whereas I’m fending off accusations for a situation which is exactly the same.
TBS624 – I have considered finding a lodger, and have discussed it with my brother and with my child. It’s not ideal, but it’s certainly feasible and it may be part of a solution.
Also, I spoke with Shelter before I first went on to the forum, and they gave me very good advice, but what was clear was that if I want to fight to remain in this house and claim HB we’re going to get dragged through the courts. I’m not scared – my brother and I have nothing to hide, we’ve done nothing wrong, and his insurers and mortgage providers have been aware from the beginning that he doesn’t live here and that he rents the house to me. Finally, yes there are other properties that I can look at in the area, but at the moment I’m still hoping I won’t have to. I wanna stay livin’ in my own home!

Sirmyser – thank you to you too for your well thought-out advice. Shelter did say that if I end up homeless, and hie myself off to the council they will be under an obligation to have my child and I rehoused. It’s an option, but not one I really wanted to take. I did wonder if it may make the council reconsider their refusal to award HB for my current address if by doing so they end up having to rehouse me. Shelter said, though, that the HB departments and housing departments of councils don’t interact at all, so it is unlikely that they would work in tandem in order to get me off their housing list and back into my own home. In your later posts you raise some really interesting points about how HB might be reconceptualised in keeping with how housing requirements differ and are evolving, and it’s certainly a topic worthy of further discussion.
Oldernotwiser - £100 is very cheap, I agree. However the property isn’t in London - it was bought so I could move out of London; at the time £100 sounded like a manageable amount for me to pay although it turns out not to have been; and finally the amount was agreed upon more than four years ago – I guess if I’d been managing to keep up with payments my brother would have increased it to £130 or so by now.
Real1314 – I do appreciate the points you’ve put forward, and thank you for bringing in some clarity, and for your advice and suggestions. Maybe you’re right to detect a wee bit of the green-eyed in people’s posts, or perhaps it’s disapproval of single parents claiming any benefits at all that’s giving rise to the more disparaging comments directed towards me. I don’t know. Benefit entitlement is a minefield of a topic, so I’ll steer clear for now. This post was concerned with eligibility anyway, not entitlement. I really am grateful for everybody’s input, however, and some people clearly know their mushrooms from their beans when it comes to benefits!

On that note, there seems to be disagreement about how tenancies amongst relatives feature in the Housing Benefit rules. I’ve found the following mentions.
The Government DWP’s guidelines published on the website mentions Close Relatives, Contrived Tenancies and Commerciality, as follows:
Close relatives : You cannot claim HB if you live in the same dwelling as your landlord, and they are a close relative of you or your partner.
Commercial basis: You cannot claim HB if the tenancy or other agreement is not on a commercial basis.
Contrived tenancy:You cannot claim HB if the local council believes that your liability to pay rent has been created to take advantage of the HB scheme. For example, if you live rent-free while you are in work, but have to pay rent when you are unemployed.

If you can satisfy the local authority that the arrangement was not intended to exploit the HB system, you may be able to get benefit.
http://www.dwp.gov.uk/advisers/rr2/housingbenefit/

The Tunbridge Wells Council website meanwhile states as follows:
If your landlord is a close relative (eg son, daughter, brother, sister) and you share the household, you cannot get Housing Benefit. If you live separately or you only share areas such as the hall and bathroom you may still be able to claim benefit as long as the arrangement was not set up to take advantage of the Housing Benefit system; http://www2.tunbridgewells.gov.uk/Default.aspx?page=545

Other Local Authority guidelines differ in content or say exactly the same thing in a different way. It all seems to be open to individual interpretation, doesn’t it, and that’s what makes the area so grey.
According to my understanding, if my brother and I had ensured from the first that our agreement was commercial and my rent was paid to him in full and on time, then all would have been ok whether I’d claimed HB at that point or not. Instead, my brother simply carried me for as long as he could afford to, which makes the tenancy non-commercial, and for some reason therefore contrived if I make a claim for HB after all this time. I don’t understand the logic in this line of thinking, but what I do understand is that it is this apparent contrivance which is causing the entire problem and apparently now the damage is done it can’t be undone. But I’m working on it!

This post is far too long, but I just wanted to say thanks again to everybody for your input. If you have any more advice or ideas please shout 'em out. And now I’m going to get some shut eye.

reggie1066

Lula_01 wrote: »

Hi,

I am 8 months pregnant and was recently served an eviction notice for my flat. I was faced with being homeless and my mum came to the rescue and said that i could rent her house whilst she moves in with her partner. However i need to be able to pay her rent as she is still paying the mortgage and as i am on statatory maternity pay i can't afford it. Can i claim HB if i am renting from a relative?

Hi Lula, I just wanted to apologise for hijacking your thread with my own problems. I really hope you've had some success in getting your HB entitlement sorted out in respect of living in your mum's property. It sounds an ideal solution to me, if she's prepared to undergo all the paperwork preparation as advised by Sirmysa in his post. It would be almost like being back at home for you, but without having to put up with the parent! Worrying times when you're trying to sort out accommodation and you're 8 months pregnant. Very best of luck with it all.

1sue23

My daughter was to be made homeless has a six year old daughter and mental health problems, over a period of 5 years had to move on average every 6 months land lords selling the house's to make money on the back of property rises, to give my daughter security we purchased a house, but to do this it had to be on a commercial basis and my daughter knows that if she can not pay we have no choice but to evict her ,through out we have spoken to Housing benefit and have to show proof of payment from the daughter .Most of the rent is paid by my daughter and just a small amount is housing benefit ,to prove it is commercial we had to take in bank statements showing payments and also proof of the mortgage payments, hope fully in the next year my daughter will come off benefits as her hours of work increase .I find it very annoying that I have had to do this and if more social housing was provided I would not have been put in this position .

real1314

tbs624 wrote: »

:rolleyes: You are incorrect, so are yourself adding to the misinformation.

It's a fair cop, I didn't even think about the "residing with" aspect. :embarasse

Neillgb

oilit wrote: »

What a morose comment.

You must be held up on a pedastal of how not to be a customer focused individual in your local council ...

If you read my first line in my post i stated that I dont know the rules - my comment was based upon what in the commercial world would be common sense.

As for your last comment, if it wasnt for people who need help - you wouldnt have a job - which is ultimately paid for by all taxpayers directly and indirectly (and before you start the old moan - yes you also contribute to your own salary).

Hope I didnt offend any others on this post - but I am speechless on the above...:mad: :mad:

I am not a housing benefit officer.

Feel silly now?

'Customer focused individual'........OMG.

eboy1975

Two penneth worth - my mother in law has been successful recently in obtaining HB for a tenancy on a property that i own. the property was purchased with a btl mtg and she has an ast tenancy agreement, therefore a commercial proposition and not contrived.

she has to live somewhere and this was the basis of the granting of HB.

the council did enquire as to to the circumstances surrounding the tenancy, we were upfront and explained everything to them.

sirmyser

Your post highlights the issue perfectly. Because of the BTL, any commercial proof required by HB would not be a problem. The grey area starts when the property subject to an application (by a relative) 'suddenly' becomes a commercial property, where little or no rent was previously charged (which happens, especially now money is tight). The council are then duty bound to enquire as to any potential contrived tenency/abuse of the system. Again, anyone presenting their situation honestly, and as eboy says - upfront, need not fear.

Was thinking about this thread over the weekend, especially reggie and Lula. I sincerely hope that they succeed and secure the accomodation they need for their families. Good luck.

Jowo_2

Alexandra_Cmpbll - you will have a greater response if you post a new thread on your specific benefit entitlement query on the Benefits forum instead of piggy-backing on this one which is about claiming HB when the landlord is a close relative.

alexandra_cmpbll

jowo, my landlord is no relative i am new to this site and will do as you suggest.