can you have a tennant on UC LCWRA?

faerielight

Hi I'm looking to move and I saw a bungalow that has an attatched 1 bedroom flat to rent out. Is it it possible to have a tenant on LCWRA? The rent from it would most likely bne about £600 a month, 

elsien

What do you mean by is it possible?
Are you asking if the landlord would accept you, or are you asking if your benefits would cover the rent?

ETA – just reread your post. Are you asking if you buying the  property and taking on a tenant will affect your benefits? 

michaels

Under tax credits earnings under the rent a room scheme were not counted as income.
If it is a standalone flat with cooking facilities and bathroom then in theory it should pay separate council tax and be properly insured 

faerielight

thanks.. it is attatched but would be self contained 

elsien

You’d need to read up on all the obligations of being a landlord and make sure the flat meets all the regulations it wouldn’t fall under the rent a room scheme. 

So I’m not sure how the income would be cancelled for your LCWRA.

Newcad

In UC Income from Rental is not counted as "other income" but beomes capital.

I believe that there is a bigger elephant in the room here though -
(Assuming that you are buying the property and not renting then sub-letting) -
If it's a self contained flat then it is not part of your home, and so the flat itself also counts as part of your capital.
The value of any flat is almost certainly going to be more than £16k and so you would not be eligibe for UC at all.

faerielight

thanks for the responses.. I'd be buying not renting and subletting it was part of the bungalow, but has been made into a self contained flat, that is within the bungalow, if that makes sense. 

Newcad

Yes it makes sense.

But if it is self contained, ie. own kitchen/bathroom/etc. then it is seperate from your 'home' it's another home under the same roof and as said should have its own address CT bill etc  particularly if you are going to rent it out.

Think of it as being 2 houses/flats next to each other.

However if it shares a bathroom/kitchen then it could be classed as part of your 'home' and disregared as capital. You could then put a lodger in there without their rent being "other income" for UC. (But it will still be income as far as the taxman, and the council, is concerned).

HillStreetBlues

Newcad said:

Yes it makes sense.

But if it is self contained, ie. own kitchen/bathroom/etc. then it is seperate from your 'home' it's another home under the same roof and as said should have its own address CT bill etc  particularly if you are going to rent it out.

Think of it as being 2 houses/flats next to each other.

However if it shares a bathroom/kitchen then it could be classed as part of your 'home' and disregared as capital. You could then put a lodger in there without their rent being "other income" for UC. (But it will still be income as far as the taxman, and the council, is concerned).

In what the OP describes it won't matter for capital purposes if it's self contained or shared, but will for council tax purpose.

TELLIT01

If the flat has a seperate council tax charge to the main property, it will almost certainly be classed as a 2nd property by DWP and its value is likely to prevent you from claiming UC.

Newcad

If it is self contained then it is not your 'home' - it is seperate from your 'home' - and that makes it a capital asset.

It doesn't matter if it is adjoined to your home or 100's of miles away, if it can be occupied seperately then it is  not 'your home'.