Do we need Gas Safety & EICR certification for parents living in a property we own?

Tuesday6

We're buying a property for my parents to live in rent free and I understand landlord building insurance is required.  Would we also have to meet all all other landlord obligations eg Gas Safety & EICR certification?  Was also wondering if you have to register as landlords with the local council or any other governing body maybe?
We're new to this and just trying to weigh up what we're letting ourselves in for, any help would be very much appreciated. 
Thank you in advance

macman

If there is no rent being paid in cash or kind in return for the right to occupy, then it is arguable that no tenancy is being created.
If there is, then you must comply with all the numerous requirements of being a landlord, about 80 of them at present I think, not just gas and leccy safety certs.
If there is a tenancy, then you must register with the LA if it is in an area with compulsory letting registration.
Are your parents really happy about having no security of tenure though? If something should happen to you, they could end up homeless.

HobgoblinBT

We rent a house to our son.  We get an annual gas safety check/service on the gas boiler and last year got an electrical inspection/ certificate that lasts 5 years.  On the house insurance side, when we explained that the house was occupied by our son our insurers, Churchill, told us that as the tenant is a close relative we could continue with a domestic house insurance buildings policy rather than a landlord insurance policy.

tacpot12

This page sets out the rules about who is a landlord, and therefore who needs to provide a gas safety certificate to their tenants every 12 months. 

Who is a landlord? (hse.gov.uk)

Even if you don't have to provide a gas safety certificate every 12 months, I would strongly recommend that you have a landlord's safey inspection done and have an EICR done as these will assure you that the property is safe for your parents to move in. You only need to have an EICR done every 5 years if you are a landlord. If you are not a landlord, it is suggested that they are done every 10 years, but if you stretched this to 15 years it is likely to be ok. 

Tuesday6

macman said:

If there is no rent being paid in cash or kind in return for the right to occupy, then it is arguable that no tenancy is being created.
If there is, then you must comply with all the numerous requirements of being a landlord, about 80 of them at present I think, not just gas and leccy safety certs.
If there is a tenancy, then you must register with the LA if it is in an area with compulsory letting registration.
Are your parents really happy about having no security of tenure though? If something should happen to you, they could end up homeless.

Many thanks for your reply.  They won't be paying any rent at all. Both of them are in their 80's and sadly aren't in great health hence why we wanted to buy a bungalow to make life easier for them.  We'll probably have the gas safety and electrical inspection done for peace of mind and if anything happened to us then the bungalow would be left to our only daughter but yes, I think it will be wise to have a clause written in our wills to say they can stay in the property if anything happened to us.. Thanks again for your help, much appreciated.

Tuesday6

tacpot12 said:

This page sets out the rules about who is a landlord, and therefore who needs to provide a gas safety certificate to their tenants every 12 months. 

Who is a landlord? (hse.gov.uk)

Even if you don't have to provide a gas safety certificate every 12 months, I would strongly recommend that you have a landlord's safey inspection done and have an EICR done as these will assure you that the property is safe for your parents to move in. You only need to have an EICR done every 5 years if you are a landlord. If you are not a landlord, it is suggested that they are done every 10 years, but if you stretched this to 15 years it is likely to be ok. 

Thanks for your reply and for posting the link, this is of a great help!

canaldumidi

I'm not sure how useful that link is to the OP. The key phrase in the link is "provided for rent by:...." but the OP is not 'renting' the property totheir parents, so the subsequent various categories  listed by hse don't apply.

The crux is whether it is a tenancy, either falling under the Housing Act 1988 or indeed excluded from the Act. And to be a tenancy there must be 'consideration' - something paid in return whether rent/cash, pay for renovations/improvements, or even a promise to walk the landlord's dog daily, or anything else that is a condition of the granting of the accomodation.

macman

If you die, and your daughter inherits and wishes to occupy or sell the property, then your parents will find themselves homeless. And if you think that could never happen, because 'it's family', then I suggest you browse these boards to  see many examples of when when this sort of arrangement goes horribly wrong.
Why don't you just lend the cash to your parents to buy the property, and then they write their wills so that you inherit the property upon their deaths? Much simpler, and no worries about a potential tenancy creation, which will involve you in a whole host of unnecessary burdens, and avoid potential SDLT and CGT liabilities?

Slinky

macman said:

If you die, and your daughter inherits and wishes to occupy or sell the property, then your parents will find themselves homeless. And if you think that could never happen, because 'it's family', then I suggest you browse these boards to  see many examples of when when this sort of arrangement goes horribly wrong.
Why don't you just lend the cash to your parents to buy the property, and then they write their wills so that you inherit the property upon their deaths? Much simpler, and no worries about a potential tenancy creation, which will involve you in a whole host of unnecessary burdens, and avoid potential SDLT and CGT liabilities?

Equally, regarding the 'family' the OP could lend his parents the money to buy the bungalow, and they could leave it to the local dogs home.

badger09

Slinky said:

macman said:

If you die, and your daughter inherits and wishes to occupy or sell the property, then your parents will find themselves homeless. And if you think that could never happen, because 'it's family', then I suggest you browse these boards to  see many examples of when when this sort of arrangement goes horribly wrong.
Why don't you just lend the cash to your parents to buy the property, and then they write their wills so that you inherit the property upon their deaths? Much simpler, and no worries about a potential tenancy creation, which will involve you in a whole host of unnecessary burdens, and avoid potential SDLT and CGT liabilities?

Equally, regarding the 'family' the OP could lend his parents the money to buy the bungalow, and they could leave it to the local dogs home.

Lend the money to parents to buy property in their name as tenants in common.
Register a charge on the property. Draw up a Deed of Trust, when 2nd parent dies or goes into care, property is sold & charge redeemed?