Universal Credit & Income

Nikster73

When making a claim for UC and declaring income and savings etc.  Do you include monthly  rental income from a property? Or is this exempt.  Is it only paye income declared and any other  benefits and savings?

poppy12345

Who lives in the property?

maisie_cat

I believe that a property you own but do not live in is treated as capital for UC purposes so possibly takes you above the £16k

poppy12345

maisie_cat said:

I believe that a property you own but do not live in is treated as capital for UC purposes so possibly takes you above the £16k

It depends who's living in it. In some cases in can be disregarded.

Newcad

You need to provide more details, but generally there are 3 possibilities:

If the property is your own home (you live there) and the rental income is from a lodger in your home - then that's all exempt in UC.

If the property that you rent out is not your own home but another property that you own  - then the value of that second property would exclude you from claiming UC - so income from a tenants rent becomes irrelevant.
(If it's a seperate flat in your own property that's a bit more complicated).

If the property that you rent out is not your own home but you don't own that rental property (eg. if you are paying rent for it yourself and then subletting it) - then the rent that you get paid for it by your tenant, (less the rent that you pay for it to your landlord), would be counted as income.

So first off we need to know how many properties we are talking about, and if more than one then who owns them?

Nikster73

Its not a property I live in, but a property I own and have an interest only mortgage on, that has tenants residing in.

poppy12345

Then if the capital in the property is more than £16,000 you're excluded from claim UC.

NedS

poppy12345 said:

Then if the capital in the property is more than £16,000 you're excluded from claim UC.

Agreed, if there is more that £16,000 in capital in the property (£value - £outstanding mortgage) then you would not be entitled to claim UC.

If the capital in the property is less that £16,000 then you can make a claim, declare the property as capital asset when making the claim and complete and return an A64a form which is available from the local jobcentre. They will then make a decision if you are entitled to UC. Rental income from the property would be treated as capital and would increase your capital monthly which must be declared if over £6,000 in total.

HillStreetBlues

NedS said:

If the capital in the property is less that £16,000 then you can make a claim, declare the property as capital asset when making the claim and complete and return an A64a form which is available from the local jobcentre. They will then make a decision if you are entitled to UC. Rental income from the property would be treated as capital and would increase your capital monthly which must be declared if over £6,000 in total.

Wouldn't it be better "if the capital in the property & other capital is less than £16,000?

Nikster73

So in theory you would be expected to have a valuation  carried out on the property before you claim UC??

If you have no intentions on selling the property, why is the capital taken into account? I'm assuming you would be expected to sell the property rather than make a claim for UC?

From 31st March there will be no tenants in the property, so this then changes everything.  There would be no rental income at all.

Grumpelstiltskin

Why is the capital taken into account?
Because it is an asset, asset doesn't mean money in the bank, it means anything you own that has a value.
You could have 2 Picasso paintings on you wall, the same would apply there.
The fact that no one will be living in the property doesn't matter the property still exists.