Informal rent arrangement - any issues?

sJanes

A friend has offered to 'rent' me a room in their house after my purchase fell though in the town I was planning to relocate to. It would be under an informal agreement where effectively I'd be a lodger, except he doesn't physically live there. He moved in with his partner (about 2 miles away) 18 months ago but has not officially moved out i.e. is still only registered there for council tax, all post goes there, still furnished etc. People (including me) have been staying there on and off.
The rent (including all bills) is extremely reasonable, half what I'd pay in rent+bills on the open market. I own my own house (outright) which I would keep on in the other location, because I will need to be there once a week for work for a lot of this year anyway (although I mostly work remotely) and a few other commitments in the area.. 
I don't think he has a mortgage but not 100% sure (house bought decades ago, inherited from parents). This is something I definitely need to confirm though.
Are there any risks (to either of us) with this arrangement? Of course, I could be asked to leave at any time but that isn't a problem as I have somewhere else to live and flexibility with work. I expect it only to be a fairly short term thing (probably not beyond the end of this year) until I firm up other plans, because shuttling between 2 properties 100+ miles apart is going to get tiresome apart from anything else.
Also how would it be best to pay? The rent is under the rent-a-room limit so there would be no tax implications, so I doubt he would ask for cash. Having just been through rigorous AML checks to prove my entirely straightforward PAYE income and transactions between my own accounts were legit I don't want to complicate things for the future with unexplained transactions having occurred.
Thanks!

elsien

No such thing as an informal more in agreement.
You are not a lodger, however much you both try to pretend that you would be, 
You would be a tenant with all the rights thar a tenant has. Your friend would be extremely foolish to go around with this. 

FlorayG

A tricky one legally. If he's still registered there and still pays all the bills there and pays (assuming) none of those at his partners house then yes, you are a lodger because everything in the house is still 'his' and you share. He would have to keep one bedroom for his sole use. The fact that he's never actually there though would make you a tenant...but who is going to know if nobody tells? As far as 'the authorities' know, he still lives there.
I've known this done and work fine

flaneurs_lobster

Given you have alternative accommodation available if the arrangement were to end then I can see few problems for you in this arrangement.

If, however, your friend had posted the same details about the proposed arrangement on here I have no doubt that the advice to them would be rather different. It does seem that they are the party who could suffer most if the arrangement were to end badly.

sJanes

I have edited my post (bold) as I left out a fairly key point.

FlorayG - yes that is the situation. All his stuff (except day-to-day things) is still there, including a bedroom. It's a 2-bed house and I would just have the one room which people have been staying in short-term. The rent rate reflects that. I wouldn't be moving any of my stuff except similar day-to-day things.

I did highlight the potential issue of me turning into an ogre and refusing to let him back in but he was relaxed about it (probably thinks it's unlikely given my other house and plans).

I don't want to be part of a dodgy tax scenario, but tenant vs lodger seems a bit of a grey area in this situation.

chrisw

Under the circumstances described, as FlorayG says, it's unlikely anyone will know - you could be a partner for anyone knows. The biggest risk is if you should fall out with each other. If he throws you out, it sounds like you'll be ok, but from his side you could make things very difficult for him. Butif he's happy to take that risk, that's up to him.

FlorayG

I'm not even sure if the OP could make things difficult - how would the OP prove that the house owner DOESN'T live there?

Albermarle

Apart from the issue of where the owner actually lives, there are other rules that mean you are a lodger rather than a tenant. Probably best to stick to them in case anybody starts asking questions.
One is no lock on your room and that you can share the facilities. Probably a few more, you need to check.
Normally there would be a lodger agreement as well with some house rules.