Rent a Room to my own Son?

affordmylife

This might sound really cheeky but I would love some advice please.

Under the governments Rent a Room Scheme can I rent a room out to my own son in order for him to claim housing benefit and then pay me? It is actually a whole floor of our house including a bathroom which would only be used by him.

He is seventeen and I have recently lost financial support from his father £160 per month and very shortly will lose the child benefit I get for him too.

He is soon to start a college course with an associated apprenticeship at a local restaurant where he will be earning minimum wage for probably 20-30 hours per week.

I am aware I have to put a lock on the door in order to rent this room out but is there any restriction to him claiming housing benefit. Obviously if he chose to rent a flat elsewhere he would have to claim housing benefit as his income would not cover his housing requirements. It would help me enormously to have some of the rent paid and he could top up the rest (supposedly - obviously I'd let him off the rest). Any ideas or suggestions would be very appreciated. Many thanks.

mjdh1957

I believe you can't claim housing benefit if you're living with parents, so the Rent a Room scheme won't apply.

Talk to the council and see what their policy on housing benefit is.

If your income is dropping because of maintenance ceasing, are you claiming all you are entitled to yourself?

dmg24

I believe you can't claim housing benefit if you're living with parents, so the Rent a Room scheme won't apply.

mjdh is correct.

mikewebs

Remember you wil probably be liable to pay income tax on ANY income from rented property - so it may not be worth your while.

lynzpower

Yes, thats correct, housing benefit cannot be paid to close family members by law.

Libra1975

mikewebs wrote: »

Remember you wil probably be liable to pay income tax on ANY income from rented property - so it may not be worth your while.

I thought the first (approx) £4000 was tax free?

mikewebs

This may provide some information for you:

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_4017804

affordmylife

Thank you all so much for taking the trouble to reply.

I am currently reading Smart Spending by Jan Furnival and she states that under the rent a room scheme "if you have a door between you and your lodger, even if tha is your teenager and/or the door is locked all the time you can charge £4,250.in rent each year". I guess the catch is the housing benefit. Obviously Im not going to charge my dear boy that but I just thought it meant if I could rent it to anyone and charge rent that anyone could claim housing benefit couldnt they and then pay me. It seems silly as I could rent it to a stranger who could claim benefit to pay me and my son could go and rent somewhere else and claim benefit to pay someone else rent. What is the point. He may as well be able to pay me as a stranger?
It seems like a no brainer to me!

dmg24

He may as well be able to pay me as a stranger? It seems like a no brainer to me!

In your situation I would agree with you, but there are others who would take advantage of the situation, hence the HB rule.

Melissa177

mikewebs wrote: »

Remember you wil probably be liable to pay income tax on ANY income from rented property - so it may not be worth your while.

Not under the rent-a-room scheme - the first 4250 per year is tax free, you don't have to declare it.

affordmylife

Just checked the link that mikewebs gave me and you are right he can claim housing benefit but not if living with parents or close relatives. So I suppose thats that. Never mind. Thought I'd discovered a reasonable way of a little bit of income. Its back to full time work for me then!

In answer to an earlier reply we are not entitled to anything else we earn approx £35,000 between us and ony get the family element of tax credit of £500 ish per year but due to previous overpayment they are taking that off us until its repaid so we get a bit fat zero!