Can you rent a house to a family member on benefits?

In this brief guide we are going to answer the question: can you rent a house to a family member on benefits?

Can you rent a house to a family member on benefits

No, you cannot rent a house to a family member on benefits as Housing Benefit regulations strictly forbid you to rent a house to a family member on benefits. If you are caught paying rent to a family member and you are on benefits, you will have to repay all the money you have paid as rent.

You generally cannot rent a house to a family member on benefits but there are some scenarios where this may work.

Below are the scenarios where paying rent to a family member may have some consequences

If you live in the same house as your family member

If you live in the same house with your close family member then it is not allowed to rent a house to the family member if they are on housing benefits or universal credit.

When referring to the term “close family member” this could be:

Your parents

Your brothers

Your sisters

Your stepbrother

Your stepsister

Your brother-in-law

Your sister-in-law

Your father in law

Your mother-in-law

Your son-in-law

Your daughter-in-law

Your half-sister

Your half-brother

Your stepchild

Your wife

Your husband

Your ex-wife

Your ex-husband

Your civil partner

The wife, husband or civil partners of any of the above

You may be able to get housing benefit and universal credit which you can use to pay rent to a family member outside of this group such as your grandmother or uncle.

You can only pay rent to them if you have a commercial agreement rather than no agreement ar all or an informal agreement. Using an assured short tenancy agreement may be the best option.

You can live with a family member who claims benefits but if you are an adult then this may reduce the amount in benefits they are able to claim.

If you are renting to an ex-partner

If you are renting a house to an ex-partner who is on benefits then this may be allowed under the following circumstances:

If the person renting the house has a child with the landlord and the child is under the age of sixteen

You pay rent to an ex-partner for a home you both lived in before when you were together

You pay rent to an ex-partner for a house you have never lived in but you won’t be able to do this if you have a child with your ex-partner and the child lives with you.

The tenancy must be a commercial agreement such a san assured shorthold tenancy agreement.

Under the conditions above you may be able to claim housing benefit or universal credit.

If your family member lives in a separate house

If your family member lives in a separate house then you can rent a house to a family member who is on benefits.

The rental relationship must be a formal one with a commercial agreement such as an assured shorthold tenancy agreement. It cannot be an informal agreement or an arrangement where no agreement is in place.

For the family member to claim benefits they may have to provide additional documents proving certain things in regards to the rental relationship.

Some of the documents that may be requested include:

The tenancy contract

Proof of rental payments 

A gas certificate

Your tenancy deposit scheme details

Your likelihood of eviction if you cannot pay rent

What to do if refused benefits?

If you are refused housing benefits or universal credit because you are renting from a family member then you may be able to challenge this decision. You should seek help from the citizen’s advice bureau.

FAQS: Can you rent a house to a family member on benefits

Below are some of the most frequently asked questions in relation to this topic.

In this brief guide, we answered the question “ can you rent a house to a family member on benefits? “ If you have any questions or comments please let us know.

If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.

You can also contact the debt charity “Step Change” if you are in debt and need help.