Property occupied by family member
My client owns a property, the net value of which is more than £16K. She is looking at renting a property to look after her severely disabled daughter (adopted), as her current home is not suitable. Her aunt and uncle would like to move into the property as they are looking for somewhere new. Both are of pension age. The cl is in receipt of IS. My question is, would the value of the property be disregarded under Para 4, Schedule 10, of IS Regs if the family members were living there rent free? What if they were paying rent?
P496 of CPAG seems to say it is disregarded.[ Edited: 23 Feb 2021 at 02:31 pm by CDV Adviser ]
Property occupied by a relative over SPC age is disregarded as capital for IS purposes. Relative is inclusive of an aunt or uncle. Whether rent is paid doesn’t matter (at least for the purposes of the question).
The property would not be disregarded for UC purposes because the UC regs only disregard in these circumstances where the property is occupied by a “close” relative which does not include an aunt or uncle.
Thanks Elliot. It looks like the rental income will be treated as income less the mortgage, council tax and water charges (P 443 CPAG).
Just to add to Elliot’s point, if DWP argue, then the definition of “relative” is in reg.2:
“relative” means close relative, grand-parent, grand-child, uncle, aunt, nephew or neice;
Thanks Paul, much appreciated.