I am doing a benefit check for a client who has just turned 60 and on IB. He owns his own home and has another home which he owns outright and has a tennant in who pays him rent. For Pension Credit purposes will they take into account the value of the second property or the rental income? he does not wish to sell the property.

Who granted the lease and what kind of tenancy is it?

Not sure. I think it's a formal tenancy, but he rents it to his daughter.I assume it's an ongoing shorthold tenancy.

Have a look at the commentary to paragraph 5 of schedule 10 of the IS Regs which is in the same terms as paragraph 5 of schedule 5 of the Pension Credit Regs (future interests in property). Rental income is usually counted as capital.

Furthermore, the value of property would be that on the open market with a sitting tenant. However, that value might not be reduced by much as it is easy to evict an assured shorthold tenant.

Thanks, I'll have a look at that.