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Treated as not liable for rent

This content applies to England

Situations where tenants will be treated as not liable to pay rent, and therefore ineligible for housing benefit.

In order to obtain housing benefit, it is necessary to be counted as liable to pay rent.[1] The following are the more common situations in which people are treated as not liable for rent (and so cannot get housing benefit).

Payments to close relatives

If a person lives with a close relative and pays rent to them, housing benefit is not payable. A 'close relative' is defined as a mother, father, sister, brother, daughter or son, including in-laws, step-parent/child and the partners of any of these.[2] The definition of close relative includes a half-brother and sister.[3]

Payments to close relatives whom the claimant does not live with do not fall under this exclusion (although the local authority may try to argue the letting is contrived or a non-commercial arrangement, see below).

Non-commercial arrangements

If a person occupies a property on an agreement that is not made on a commercial basis, housing benefit is not payable.[4]

There are no rigid rules in determining what is a commercial arrangement. Local authorities should not assume there is no commercial arrangement just because the agreement is between close friends or relatives, the rent is low or because the landlord does not let to tenants for purely financial reasons.[5]

Contrived arrangements

If a person's agreement to pay rent was set up to take advantage of the housing benefit scheme then housing benefit is not payable.[6] To deny housing benefit for this reason, the local authority must be satisfied that the main reason for creating the liability is to obtain or increase housing benefit entitlement. Local authorities must consider each case on its own merits.

Other circumstances in which housing benefit cannot be paid

There are other circumstances in which a claimant is to be treated as not liable for rent in respect of a dwelling. This includes where the:[7]

  • claimant's landlord (or one of her/his joint landlords) is a parent of her/his child (who is under the age of 16)[8]
  • claimant's landlord is her/his former partner and they lived together in the property on which the claimant pays rent. 'Former partner' has been held to include all former partners, not just the most recent.[9] The exclusion applies even if the dwelling currently occupied by the claimant is only part of the dwelling formerly occupied by the claimant and her/his former partner - eg where the claimant's relationship with their former partner has broken down and the claimant remains in the property but moves into a separate bedroom[10]
  • claimant was formerly a non-dependant of anyone living in the claimant's home - unless the letting was not intended to abuse the housing benefit scheme
  • claimant (or a partner) owned the dwelling (including under a long tenancy) at any time in the past five years - unless s/he could not have continued to live there without giving up ownership.[11] An 'owner' is the person who is, 'for the time being' entitled to sell the property. Where a claimant's property was made the subject of a 'restraint order' in court proceedings connected with a criminal offence, the Upper Tribunal held that he was not the 'owner' from the time that order took effect because the effect of the order was to prevent him from disposing of the property himself.[12]
  • claimant rents from a company or trust in which s/he has an interest (but there are exceptions for lettings that are not intended to abuse the housing benefit scheme), or
  • claimant (or a partner) has to live in the dwelling as a condition of her/his employment.

HMO licensing and rent liability

Where a claimant is living in a house in multiple occupation (HMO) that should be licensed, the lack of licence alone does not mean that the landlord cannot charge rent. A tenant living in an unlicensed HMO is entitled to claim housing benefit.[13]

[1] s.130(1) Social Security Contributions and Benefits Act 1992; reg 8(1) Housing Benefit Regulations 2006 SI 2006/213; reg 8(1) Housing Benefit (Persons who have attained the qualifying age for pension credit) Regulations 2006 SI 2006/214.

[2] regs 2(1) and 9(1)(b) Housing Benefit Regulations 2006 SI 2006/213; regs 2(1) and 9(1)(b) Housing Benefit (Persons who have attained the qualifying age for pension credit) Regulations 2006 SI 2006/214.

[3] Bristol CC v JKT [2016] UKUT 0517 (AAC).

[4] reg 9(1)(a) Housing Benefit Regulations 2006 SI 2006/213; reg 9(1)(a) Housing Benefit (Persons who have attained the qualifying age for pension credit) Regulations 2006 SI 2006/214.

[5] HK v South Hams DC (HB) [2017] UKUT 254 (AAC); CE v Maldon DC (HB) [2015] UKUT 0565 (AAC); R v Rugby BC ex p Harrison (1994) 28 HLR 36.

[6] reg 9(1)(l) Housing Benefit Regulations 2006 SI 2006/213; reg 9(1)(l) Housing Benefit (Persons who have attained the qualifying age for pension credit) Regulations 2006 SI 2006/214, each as amended by Housing Benefit (Amendment) Regulations 2007 SI 2007/1356.

[7] reg 9(1) Housing Benefit Regulations 2006 SI 2006/213; reg 9(1) Housing Benefit (Persons who have attained the qualifying age for pension credit) Regulations 2006 SI 2006/214.

[8] South Lanarkshire Council v DG (HB) [2018] UKUT 417 (AAC).

[9] DH V Kirklees MBC and Secretary of State for Work and Pensions [2011] UKUT 301 (AAC).

[10] Bexley LB v KM [2017] UKUT 0354 (AAC); R (on the application of Painter) v Carmarthenshire CC HBRB [2002] HLR 447.

[11] reg 2(3) Housing Benefit (Amendment) Regulations 2007 SI 2007/1356.

[12] GN v Sevenoaks BC (HB) [2016] UKUT 0271 (AAC).

[13] para 11 HB Circular A11/2006, June 2006.

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