I have a really complicated case that i keep going round in circles on, any help would be much appreciated, i shall try and explain it so it makes sense.

16 year old with significant learning difficulties (still in FT education) lives with his father who rents one of our properties (we are an RSL)

Father dies and his daughter (who is on IS with 2 of her own children) moves in to look after her brother.

We look into putting the tenancy into her name in trust for her brother - this is not yet sorted as legalities still being looked into and at this time 16 year old is on tenancy.

We apply for HB/CTB in 16 years old name, advise his only income is LRMC and MRCC of DLA, name sister as non dep.

LA refuse and state claim should be in sisters name.

Questions:
Should claim be in his name or sisters and will this change once trust is set up?
Who's name should be on Council Tax?
If son, will there be an exemption?
If sister will she claim CTB and how would that work if he claims HB?

Please help, i am so stuck!
Thanks
Charlie

Based on the info given, the facts are currently these:

1) The sister is not liable and never has been and, apart from being an occupier, doesn't have an interest in the dwelling (currently).

2) The 16 year old, presumably, isn't directly liable as he is under 18.

3) Someone else, presumably, is currently being held liable (who?).

4) The 16 year old has claimed HB.


Based on all the above, the 16 year old is entirely within his rights to claim HB. He can properly be treated as liable to pay "rent" (or monies for use and occupation) under Regulation 8 of the HB Regulations 2006.

To cover all bases, I would get the 16 year old to submit an appeal. If the LA has not yet issued a formal notification of decision, they must - a claim has been made, so a decision must be made on the claim. At the same time, I would ALSO get the sister to submit a claim "just in case" - make it clear that is the basis of the claim.

I'm not sure about CTAX liabilities, so I'll leave that for someone else.

For what it's worth, trustees who rent property are legally liable to pay the rent, not the beneficiaries. This is becaue the legal title vests in the trustees and the beneficiaries only have an equitable interest.

The difference between "law/legal" and "equity/equitable/beneficial" is one of those things that law students wrestle with during the second year of a law degree (it being too hard for the first year) as part of the subject of equity and trusts.

Essentially a trust is an arrangement whereby the legal title to property is vested in trustees whose obligation is to manage the property for the beenfit of the beneficiaries. Thus, for example, if freehold land is included in a trust, the trustees are the only people who can sell, let, or mortgage it.

A person under the age on 18, even if of full mental capacity, cannot have a "legal estate" in land (which includes most leases), and thus it HAS to be put into trust for them. It will be for the trustee to ensure that the rent is paid because the tenancy agreement will be with the trustee. However, I have no idea how this works with claiming benefits by the trustee.

Just to clarify, even if the liability is held in trust, it may still be possible for someone under the age of 18 to claim HB - there is no lower age for claiming HB.

Thanks for your replies.

I have completed a GL24 with the 16 year old but hadnt though to complete new HB with the sister, which i will now do.

As yet the legalisties have not been sorted so no trust has yet been yet up so we are going on the assumption that 16 year should claim HB.

Problem is of course he cant be liable for CTax, i think sister must be. She would need to claim CTB though as she is on Income Support. Would she be able to claim CTB if he has an HB claim in payment?

Thanks again

Has the sister claimed child beneftit in respect of the brother?

If that is the case they are a family. The sister is not by definition a non dependant and the income of the family must be aggregated.

To make matters worse, if the brother then goes on to claim HB, his applicable amount will be that of a single person over the age of 18, plus the disability premium. He wont get the amounts for his sister and her children included as by definition he is not responsible for them.

If the sister is getting child benefit in respect of her brother, she ought to also claim HB

She should also apply for child tax credit or for an increase in her IS in respect of her brother

can it not be arranged that sister take over tenancy? i appreciate that the 16 year old has "inheritance rights" so to speak to the tenancy, where his sister doesn't, but since he has no legal capacity to take the tenancy on.....

just a thought...

It's the liability to pay rent that attracts the HB ents surely, not the surety granted by a tenancy; the liability being separate to any lease that might be granted.

I think the LA are getting confused between the tenancy and the liability.

I think the following should settle the matter of whether the minor is liable fot the rent and thus entitled to claim HB on the property.

http://www.rightsnet.org.uk/dc/dcboard.php?az=show_topic&forum=102&topic_id=8181&mesg_id=8181&page=6

And Prince re-affirmed in Newham LBC v Ria (2004) CA.