Obtaining Housing Benefit when a Trust is involved

[DavidK]

Hi

I wonder does anyone have practical experience of seeking Housing Benefit where a person with a learning disability is renting from a family Trust?

My wife and I have set up a discretionary trust whose potential beneficiaries are our children and their children etc. The trust is buying a flat which will be occupied by one of our sons who has Downs Syndrome. Ideally, the trust would like to set up a tenancy agreement and charge a rent so that service charges and other outgoings are covered. However, Regulation 9 does not permit a claim where the rent is payable to a trustee of a trust of which the tenant is a beneficiary unless the Local Authority is satisfied that it is not a means of taking advantage of the HB scheme.

Does anyone have any experience of how difficult this is to prove, the attitude of Councils and what factors are taken into account?

[JohnVerge]

Dear David.

Here at Golden Lane Housing (Mencap's housing arm) we have lots of experience supporting trusts rent to their loved ones. Over the years this has involved us supporting directly - through leasing trust properties - or indirectly through general advice. Around 6 years ago we jointly funded a family trust to successfully appeal the decision of the Housing Benefit not to pay their related tenant's rent.

From that appeal we learnt what trusts needed to do to show a tenancy is a commercial arrangement and is not considered contrived for the purposes of Housing Benefit. Evidence can include:

-A commercial agreement, such as a Tenancy Agreement document, a Rent Book, or bank statements showing evidence of regular rent payments.
- Mortgage statements from the landlord (if exists) showing that payments are needed to be met by a rent payment.
- Rent covers costs of management, maintenance, insurance etc
- The Landlord arranges for tenant to be given a tenancy, which is then dealt with on a regular basis by a Managing Agent or Housing Association.
- Evidence that there is no other suitable accommodation, if the tenant in question is disabled.
- Property not left empty for significant time

I am more than happy to provide further advice if you would like to contact me at john.verge@glh.org.uk and we can arrange a convenient time to talk.

Kind regards

John

[DavidK]

John

Thank you for your informative reply. I will be in touch.

Kind regards
David