UC and taking a lodger

DebraHart

Hi

I am a mature student on Universal credit but also have a part time job paying £550 a month.

I own my own home.

One of my children has left home and I have a converted garage with en-suite that a friend was looking to move into as a "lodger" we want to do everything above board so is planning on paying me £50 a week and we will get a formal agreement drawn up etc.

Will this effect my universal credit as i have read i dont have to declare anything below £7500 a year and this works out as 2,600.

I also am council tax exempt for being student but if they moved in have been told they will be eligible to pay the council tax at 75% single person occupancy? is this correct?

and finally i receive a maintenance loan and student towards me being a student and my daughter who is 18 and also a student but its not clear if the £50 a week will effect the amount they will lend me next year when we have to re-apply - citzens advice said it wont but an advisor at mu uni said it would?

Thanks in advance

sourpuss2021

Lodger income is ignored for the purposes of Universal Credit so you don't have anything to worry about there. 

My guess is the biggest trouble will be between you and your friend! 

Set a realistic rent.  Don't do it if it's just for £50, or else at such a low rent you may need to get used to them wanting to stay in your house for the rest of their life!  Better to charge them the going rate - perhaps it's £500 a month. 

Also you should set clear rules and boundaries.   Get them to sign a written agreement and discuss what you are comfortable with in regard to them having guests, noise, cleaning, etc. 

Think about how you would feel to lose this person as a friend.  Because that often happens when you try to mix up friendship and being someone's live-in landlord, which is what you'll be...

poppy12345

DebraHart said:

and finally i receive a maintenance loan

Are UC aware that you receive a maintenance loan?

Bigwheels1111

Don’t know about UC, but renting a room I did for years.
As you will be a landlord.
From memory you will need a gas safety check, CP12 certificate.

Follow the rules.
https://www.gov.uk/rent-room-in-your-home/the-rent-a-room-scheme

CIS

DebraHart said:

I also am council tax exempt for being student but if they moved in have been told they will be eligible to pay the council tax at 75% single person occupancy? is this correct?

No, you, will be liable for the council tax charge as the resident owner (regardless of you being a student - that's immaterial in this case).

You will be liable for the 75% charge that becomes due and would need to claim council tax reduction. Your lodger would not be eligible to claim any council tax reduction in their own right.

kaMelo

Very good advice from @CIS as to why student only households should never take in lodgers. They are usually advised to only share with other students and put everyone on the tenancy.

DebraHart said:

and finally i receive a maintenance loan and student towards me being a student and my daughter who is 18 and also a student but its not clear if the £50 a week will effect the amount they will lend me next year when we have to re-apply - citzens advice said it wont but an advisor at mu uni said it would?

Thanks in advance

CA is wrong, the advisor at your uni is correct, when you fill out student loan applications the household income they are asking about is taxable income. Any rent you receive from a lodger is taxable income and should be included in your declaration so it may reduce the amount of maintenance loan you qualify for.

I would also add are UC aware of your maintenance loan? 
Given you have a monthly income of £550 pm and a maintenance loan I'm amazed you qualify for any UC.

Spoonie_Turtle

kaMelo said:

I would also add are UC aware of your maintenance loan? 
Given you have a monthly income of £550 pm and a maintenance loan I'm amazed you qualify for any UC.

Always good to double check, but they mention 'one of their children' in the opening post, so possibly multiple children still on the claim, plus the work allowance - no rent, so the work allowance covers all of the income from their job.

poppy12345

Spoonie_Turtle said:

kaMelo said:

I would also add are UC aware of your maintenance loan? 
Given you have a monthly income of £550 pm and a maintenance loan I'm amazed you qualify for any UC.

Always good to double check, but they mention 'one of their children' in the opening post, so possibly multiple children still on the claim, plus the work allowance - no rent, so the work allowance covers all of the income from their job.

Then you have the maintenance loan on top of that, which would reduce their UC.

Spoonie_Turtle

poppy12345 said:

Spoonie_Turtle said:

kaMelo said:

I would also add are UC aware of your maintenance loan? 
Given you have a monthly income of £550 pm and a maintenance loan I'm amazed you qualify for any UC.

Always good to double check, but they mention 'one of their children' in the opening post, so possibly multiple children still on the claim, plus the work allowance - no rent, so the work allowance covers all of the income from their job.

Then you have the maintenance loan on top of that, which would reduce their UC.

Yes, my point was that the work allowance and at least one child on the claim makes it less astonishing they could still have any entitlement even with the income and maintenance loan.

But still good to check UC are indeed aware of the loan, otherwise that would be a hefty overpayment to be recovered.

deannagone

Yeah my son claims ESA, he was a student for part of that time.  He was told the maintenance grant wouldn't affect his ESA when he started an out of London University because the maintenance loan was lower.  He didn't ask ESA like he should have done, he seems to have gone to a charity for the disabled for advice who no longer exist.  Several years later he received an enquiry from ESA as they'd discovered records he was a student.  He's now paying thousands back from his ESA given for that time. 

The best people to check with are UC.  My son could have been done for fraud you see, as well as having to pay the money back.

Also keep records of what you are told.  As I said, my son was chased years later.  When I enquired at the time, he said he'd been told that his ESA was unaffected by his maintenance loan, I assumed he'd asked ESA themselves as that's what I had done the previous year when he was still living with me. It was all a bit of a nightmare, because it was a long time after he was a student and being autistic, and young, he hadn't kept any records so I was never sure who, if anyone he'd spoken to at the time when I was involved in trying to communicate with ESA while they were investigating.

Andyjflet

Sounds very cheap, dont forget an increase in council tax, bills, water, gas etc, my lodger paid £400 a month and it cost me probably £100 a month to run the set up.