Dad owns flat, can I get housing benefit?

BigAunty

fogartyblue. wrote: »

What the dad needs to do is find out what the HA is for that property and charge it.

Provided that the tenant is entitled to the property, age, circumstances etc, then the full rent would be paid by the council.

...

Possibly, if not considered contrived (set up to exploit the housing benefit system) to maximise the rent when on benefits but pay modest rent when in employment.

MrsManda

BigAunty wrote: »

I know that the council will expect some formality in the tenancy, such as a tenancy agreement rather than a verbal agreement, and therefore a more commercial or business like approach to it, but I've not yet seen any regulations or guidance that explicitly state that it must be rent charged at market rate.

So if you can provide any evidence, this would be appreciated as this 'commercial level rent' is often cited by MSE members on family related tenancies like this and I haven't yet seen anything official on the matter.

I don't think the regulations do say that it has to be charged at market rate but that the tenancy has to be commercial.

The Housing Benefits Regulations 2006 (haven't found a more up to date one) state that for the tenant to be liable for rent and therefore able to claim HB the tenancy must be on a commercial basis, not that the rent has to be charged at market rate.

Circumstances in which a person is to be treated as not liable to make payments in respect of a dwelling

9.—(1) A person who is liable to make payments in respect of a dwelling shall be treated as if he were not so liable where—

(a)the tenancy or other agreement pursuant to which he occupies the dwelling is not on a commercial basis;
....

(2) In determining whether a tenancy or other agreement pursuant to which a person occupies a dwelling is not on a commercial basis regard shall be had inter alia to whether the terms upon which the person occupies the dwelling include terms which are not enforceable at law.

http://www.legislation.gov.uk/uksi/2006/213/regulation/9/made

I don't work in this field so cannot be 100% certain but my reading of this is that providing the tenancy agreement is legally enforceable then the tenant is liable for the rent and therefore able to claim HB.

This website: http://www.ownershipoptions.org.uk has a pdf which explains commercial tenancies in more detail but I don't know how reliable the information is though it does quote the above regulations.
The pdf can be opened direct here: http://www.ownershipoptions.org.uk/pdf/Buying%20to%20let%20to%20a%20relative.pdf

BigAunty

Alive wrote: »

...

The flat would rent for about £380 - 400 so I would hope to get the £200 covered. Guess only time will tell.

The rate of LHA isn't calculated on the rent that the tenant is currently paying- the main driver is things like number of occupants, their age and sex, and their household income.

Your rent is low so chances are most, if not all, will be covered if it is allowed by the local council.

Look at the LHA calculator on the Direct Gov website. If you are under 35, you are entitled to the shared accommodation rate as a maximum (regardless of whether you live in your own self contained property) and if you are over 35, you get the 1 bed rate.

Obviously, the council will only pay the rent charged as long as it's on or below the LHA rate, not allow the tenant to keep the excess - plus anyone living in accommodation that is dearer than their LHA rate simply has to pay the difference out of their benefits or move somewhere cheaper.