i own my own home but don’t live there, could i rent it out to a friend and can she claim housing benefit? w?
June 11th, 2010 by admin
she is due to move in in november so really need to know as i don’t want to get into any sort of trouble please help!!
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You can rent it to her and if she is entitled to HB she will get that, you are not related
Edit. That’s right, you are named as the landlord (your friend can tick the box that asks if the Council can contact the landlord or not) She will be asked on the form if you are related, she says no. Job done
look at it this way,your friend ceases to be your friend and becomes
your tenant and as such she makes her claim as normal for housing
benefit which she gets and then pays to you as rent.
what you have to watch is your income tax commitment best to ask them and they will advise
You need to be more specific about the ‘housing benefit’??
Yes she can claim housing benefit. As long as you have a proper commerical agreement in place. She will need to provide a letter or tenancy agreement for the property.
When setting the rent, you should take in to consideration how much she may be awarded under the local housing allowance.
If she is under 25 and single she will only get up to the shared room rent, depending on her income. The LHa is the maximum they will pay.
Check the benefit rate for the area you live in here
lha.gov.uk
Please note the bedroom allowance is based on her family circumstances – not the size of the property.
So for example Her plus one child = 2 Bedroom rate
her plus two children under 10 of the different sex, or under 16 of the same sex = 2 bedroom
Her plus 1 boy(15) and 1 girl (8) = 3 bedroom rate
There are details on LHA website to work it out.
You can do that without any problems at all.
Just remember that rental income is taxable and that you are legally required to get permission from the lender if there is still a mortgage on the property. You will also need to amend the home insurance policy and have things like gas safety certificates.
Even though she is a friend, you still need some sort of rental agreement drawn up.