Financial help for private landlords losing tenants due to Coronavirus/Covid 19

andz21

Hi. What financial help is there for a private landlord who has lost tenants due to leaving the UK because of countries going into lock-down/losing their job in UK or front-line/key-workers moving out as they are getting free accommodation elsewhere.  Also delaying rent payments/reducing rent for existing tenants.  The rental business (so no trade profits) is the only source of income for the landlord as an individual.  All Self-Assessment tax returns have been submitted on time.  Apart from mortgage loan payment holiday (only a few mortgages on a portfolio of approx. 18 properties), bounce back loan and Universal Credit claim (I think this would be allowable), is there anything else available for private landlords who are struggling?  I believe that they would automatically not be eligible for the SEISS but it is possible to ask HMRC to review this after they have used the online tool to check if they are eligible, does anyone know what HMRC would take into account when reviewing?        

Jeremy535897

I am afraid that nothing is likely to be available. SEISS is only for trading profits, and residential rental income is not trading. For universal credit, your capital (which if £16,000 or more precludes a claim for universal credit) would be taken to include the market value of all your properties less the mortgages. I have heard that some decision makers at UC are prepared to treat rented properties' value temporarily as nil, on the grounds that they cannot realistically be sold at present, but that will change. 

Grumpy_chap

If you have a portfolio of 18 properties, then presumably some of them are still paying rent or should be?  
Your capital is likely to exceed the limits for UC.  (Just one mortgage-free property would do that.)
If your turnover is higher than Bounce Back Loan limits, then CBILS might be an option.
Your posts suggests you operate as sole-trader, so I assume no PAYE payroll.  If Ltd Co with payroll, then furlough might be possible.
Another source of capital would be to re-mortgage one of the mortgage-free properties and, if your relationship with your bank is long and good, that might be possible even in these times.

Grumpy_chap

I just checked, the Bounce Back is  "Available to most UK-based businesses, regardless of turnover."

Jeremy535897

As I said above, it may be possible, at least temporarily, to argue the properties have no value for UC purposes, but by no means certain.
Bounce back is for loans up to £50,000,  CBIL for over £50,000. Bounce back loans are available for turnover of any amount, CBILs for turnover up to £45 million. Turnover caps the loan, so if turnover is £100,000, maximum bounce back loan is £25,000.
They are not available for rental businesses, as one of the conditions is:
"More than 50% of the income of the business (together with that of any member of any group of which it is a part) is derived from its trading activity. This confirmation is not required if the borrower is a charity or a further education college."

yksi

There are property auctions running this week, so properties can still be sold, albeit not at the prices people might prefer. Even if the asset limit of £16,000 is ignored, one would really expect that even half your tenants paying rent will cancel out UC, based on the income. We're talking about a pretty large amount of money coming in, and unfortunately, UC does not take your regular household expenses into account. The only one it cares about is the LHA rate if you pay rent.