She’s on ESA(ir) so not the LA’s direct problem, but, if she isn’t paying her HB over to her dad, the rent payments should be counted as notional income under ESA Reg 107(3)(c) but only to the extent that they are funding the HB eligible rent. The portion above the HB eligible rent would not count as income.
If that notional income is enough to float her off ESA(ir), exactly the same rules apply for HB purposes: see HB Reg 42(6)(b) and the definition of “rent” in Reg 46(13).
