advice needed re renting

fluffy70

Hi,

I'm hoping that someone out there may have direct experience of this and can advise?

we currently rent a 3 bedroomed property on a private tenancy arrangement and we both work but are classed as low income. We want to make a claim for Housing benefit to help us out financially, and we know that we would be entitled to about £200 a month towards our rent and possibly a small deduction from the council tax (which we are struggling to pay as we don't have enough money coming in). We have one child and she goes to nursery 3 days a week while we work and my fiance can't look after her while I work because working hours clash.

Our issue is that the landlord has said to us that we must NOT claim housing benefit as he will get into trouble with the tax office and the claim could be linked from the council to the tax office and they would trace it back to him - he's not making a profit from it - basically we're just paying his mortgage. Is it true that it can be traced back to him and that he would be in trouble? We could just about survive if we don't claim housing benefit but life would be extremely hard for us.

He does have a BTL mortgage so it's not a case of that being a problem.

Thanks in advance

M

Owain_Moneysaver

Your landlord is breaking the law if he's not declaring his rental income to Hector the Taxman. He should be able to offset his outgoings (mortgage and maintenance) against his income (rental) and only pay tax on the profit. He may be unaware of this.

Maybe he would drop the rent to compensate you for the loss of the benefit to which you are statutorily entitled? No, I didn't think so.

G_M

Your Landlord is clearly breaking the law by not declaring his income to HMRC. This is not your fault, but nor should you suffer as a result of it. It is HIS problem.

Claim what you are entitled to. If you feel sympathy towards him, extend him the courtesy of telling him what you are doing so that he has an opportunity to place himself inside the law.

Do not become involved in his criminality by assisting.

BitterAndTwisted

There is no Housing Benefit any longer: it's now called LHA (Local Housing Allowance) and it's paid direct to the tenants, not to the landlord although I'm not sure whether you have to provide the local authority with a copy of your tenancy agreement in order to claim it. Your local authority's website should have the information about how to claim

PasturesNew

Claim. He will never know that you did as he's not told.

If they don't catch him while you live there, bide your time and report him after you've left

jamesd

If you're paying his mortgage, he's making a profit on any long term gains in property prices. If he's doing it on a repayment mortgage he's also accumulating equity. In addition, it's been commonplace for BTL mortgages to require that the rent exceed the mortgage payment by 15% or more. Interest on a mortgage for a BTL property can be deducted from income. Unless he's lying to you about the rent only covering the mortgage he's nothing to worry about.

Jowo_2

PasturesNew wrote: »

Claim. He will never know that you did as he's not told.

If they don't catch him while you live there, bide your time and report him after you've left

From a duplicate thread in the benefits forum, it is clear that the landlord's wife works for HMRC and that the taxman has access to the LHA system to check whether or not landlords are submitting tax returns.

So actually, he could feasibly identify this if his missus has access to certain systems...

plus it doesn't take a genius to work out why the landlord subsequently receives a letter from HMRC following up the lack of submitting tax returns.

poppysarah

fluffy70 wrote: »

Hi,
Our issue is that the landlord has said to us that we must NOT claim housing benefit as he will get into trouble with the tax office and the claim could be linked from the council to the tax office and they would trace it back to him -
He does have a BTL mortgage so it's not a case of that being a problem.

How do you know he has a BTL mortgage?

Seriously shady.

Claim it for goodness sake. Prepare to move though.

adg1

It sounds very much like he is not declaring taxable income to the Taxman. Which in turn means we all get charged that little bit more to cover him.

How do you know he's not making a profit from it? Have you seen his mortgage statements? Proof of BTL consent?

As LHA is paid direct to the tenants now it would not be disclosed to the landlord.

My guess is that, due to his partners position in the HMRC as stated by JOWO, he is pretty worried that if it did come out she would be up a certain creek with a lack of paddle as she is then guilty of 'playing the system' to better her own financial position (albeit her partner doing the dirty work) whilst ensuring no one else does it with their taxable income. Basically an HMRC worker biddling the tax system.

As others said earlier, you are totally due your benefits so CLAIM THEM. Give your landlord time (a couple of weeks should do it) to reallign himself with the laws of goodness and then claim anyway.

DISCLAIMER: Obviously I don't know this is the case, but it is certainly suspicious and would be my guess.

property.advert

When you claim LHA they ask whether they, the council, can contact your landlord. Just say no. It does not hinder your claim at all.

Wee_Willy_Harris

fluffy70 wrote: »

Hi,

I'm hoping that someone out there may have direct experience of this and can advise?

we currently rent a 3 bedroomed property on a private tenancy arrangement and we both work but are classed as low income. We want to make a claim for Housing benefit to help us out financially, and we know that we would be entitled to about £200 a month towards our rent and possibly a small deduction from the council tax (which we are struggling to pay as we don't have enough money coming in). We have one child and she goes to nursery 3 days a week while we work and my fiance can't look after her while I work because working hours clash.

Our issue is that the landlord has said to us that we must NOT claim housing benefit as he will get into trouble with the tax office and the claim could be linked from the council to the tax office and they would trace it back to him - he's not making a profit from it - basically we're just paying his mortgage. Is it true that it can be traced back to him and that he would be in trouble? We could just about survive if we don't claim housing benefit but life would be extremely hard for us.

He does have a BTL mortgage so it's not a case of that being a problem.

Thanks in advance

M

This is just a personal opinion based on what I would do and in no way constitutes best practice or even good advice. Take it for what it is and make up your own mind.

Get an LHA assessment detailing how much you would be entitled to (there should be no need to identify the address to do so). Show this to the landlord and ask that he either reduces the rent by this amount, or allows you to claim LHA. From what you say, he is costing you about £200 a month. Politely inform him that if he is unable to reduce the rent to an agreeable level, you will have no option but to claim in order that you may fulfil your obligations in accordance with his tenancy agreement (ie pay the rent). Also, politely, advise him that should he serve notice, you would again have no option but to claim in order to reduce your liability and enable you to save the necessary funds for moving costs.

As a side issue, did you pay a deposit? If you did, I assume he hasn't protected it? In which case, he can't serve S21.

I'd also be very careful about what YOU put in writing. It could be viewed that you are assisting his criminal activity.

Oh.... And start looking for somewhare to live with a more reputable landlord.