Renting a house from parents and housing benefit

marliepanda

pmlindyloo wrote: »

The OP has been 'forced' to give details of her father's finances because of the tirade about 'lining his own pockets'.

Hardly a tirade.

There are reasons that there are stricter rules about renting to family members. If its 'going in somebodys pockets anyway' why do councils choose to make the distinction. Yes they are paying it anyway, to another landlord. Why are there different rules for families?

To stop people taking advantage, to end up with two properties instead of one, without the usual risks of letting property, and letting the council fund it.

If there are other reasons that councils don't just let people rent to family no questions asked, please let me know. People in this thread are taking the view of 'well the benefits getting paid regardless, what does it matter who it goes to' Well councils clearly don't agree with that...

The 'facts' are this is not a commercial tenancy, they will struggle to prove it is (as its not...) so the 'doom and gloom' as you put it is people stating the facts. Shall we just say the council will be happy to do it? Its not a fact, but its not the doom and gloom you're so worried about.

pleasedelete

Did we miss the option of working and paying rent so that no housing benefit was needed?

Mojisola

Dawniedawn wrote: »

I'm currently in social housing in London. I am very unwell and very unhappy.

pleasedelete wrote: »

Did we miss the option of working and paying rent so that no housing benefit was needed?

If you're fit and well, of course that's the best option.

Ygritte

pleasedelete wrote: »

Did we miss the option of working and paying rent so that no housing benefit was needed?

I was working full time up till a few months ago but had a nervous breakdown and subsequently discovered I have fibromyalgia and type 2 bipolar.

But thanks for the judgement. Really hope you or your family never need help and have to deal with the wonderful stigma.

Horace

I live in a house owned by my parents (they do not live here with me). I get some council tax benefit but I do not get any housing benefit because the house is owned by my parents. I pay all the bills and they pay for maintenance (boiler service, new internal doors, painting and buildings insurance), so I pay my contents insurance, electricity, gas, shopping.

My parents bought the house I live in because they did not want to see their daughter claiming housing benefit and they had the money to invest (so better to let me have my inheritance now in the form of somewhere to live was their view). When I get a job then I will be able to make more of a monetary contribution and buy more things for the house.

Certainly the council where I live won't pay housing benefit because I live in a house owned by my parents. I thought this was the same for all councils.

Ygritte

Horace wrote: »

I live in a house owned by my parents (they do not live here with me). I get some council tax benefit but I do not get any housing benefit because the house is owned by my parents. I pay all the bills and they pay for maintenance (boiler service, new internal doors, painting and buildings insurance), so I pay my contents insurance, electricity, gas, shopping.

My parents bought the house I live in because they did not want to see their daughter claiming housing benefit and they had the money to invest (so better to let me have my inheritance now in the form of somewhere to live was their view). When I get a job then I will be able to make more of a monetary contribution and buy more things for the house.

Certainly the council where I live won't pay housing benefit because I live in a house owned by my parents. I thought this was the same for all councils.

Does it cause problems where you are unable to get access to certain other benefits and/or help, because you don't receive housing benefit? And do they count you as a dependent on your parents?
Also does it affect your parents in anyway? In term of the government/taxman assuming that they must be making money in someway?
Thanks x

Mojisola

Horace wrote: »

I
Certainly the council where I live won't pay housing benefit because I live in a house owned by my parents. I thought this was the same for all councils.

If they told you that, they're stretching the facts.

Unless they can show that a tenancy has been contrived, they have to pay.

PlymouthMaid

I hope you find a way to move with your parents OP. As already alluded too, Cornwall can be isolating. If and when you are ready to return to work that could turn out to be harder than you think so be careful.

Housing_Benefit_Officer

Dawniedawn wrote: »

I'm currently in social housing in London. I am very unwell and very unhappy.

My parents have a small cottage in Cornwall that they have been planning on retiring in but my dad has spoken with me about the possibility of them getting somewhere else nearby and letting the cottage to me. A new start sounds amazing but I don't know how the housing benefit would work out? They aren't rich so couldn't afford to just give it to me for nothing. I would be giving up a two bed house in london so that would be helpful for my council.

Any advice would be great x

I see you live in Ilford. I had the misfortune of living in a house off Green Lane - that made me very unhappy. I would have jumped at the chance of moving to Cornwall.

First - yes of course your parents can rent the property to you. There is nothing in the legislation that prevents you from doing this. And yes you can claim Housing Benefit. Ignore the doom-mongers who say you can't.

Second - as you are renting from a close relative the Local Authority will need to see if the tenancy is on a commercial basis and the tenancy isn't contrived and created to take advantage of the benefit scheme.

There needs to be clear blue water so to speak to satisfy any queries that the rental agreement is commercial.

1) The first question we always ask is "If your daughter/son didn't pay rent would you evict them". If they answer no then we will say the tenancy isn't commercial as no landlord would allow a tenant to live rent free in their property. If the landlord says this is a commercial venture and I was planning to rent the property out but my son/daughter needed somewhere to live.

2) Ensure all utility bills are in your name.

3) Landlord insurance would indicate that your parents are doing this as a commercial venture.

4) Property insurance that shows your parents insurers are aware the property is being rented out commercially.

5) Accurate records showing rent paid and arrears accruing and evidence of attempts to recover arrears (i.e letters etc) will indicate that it is a commercial let.

6) Parents registering as landlords with HMRC and completing annual tax returns.

7) Gas safety certificate - needs to be done every year.

8) Electrical Test certificate before property rented uot.

If the Local Authority rejects your claim you will be able to show, landlords insurance policy, Insurance company aware being let, accurate records of rent paid and arrears or letters threatening eviction due to arrears, parents registered with HMRC as landlords, bills in your name etc.

It is best for your parents to speak directly with the local Housing Benefit Department for some informal advice.

I wish you every luck for the move and hope you do. Having had the misfortune of living in Ilford you will really enjoy the move to pastures new.

This may be useful:-

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/236950/hbgm-a3-liability-to-make-payments.pdf

Ygritte

Thanks so much HBO! Yeah I'm off Green Lane too! Hell hole that it is.

Lots to think about there and it's a relief to know it could be possible without doing anything underhand x