HB eligibility for shared ownership

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    We have a landlord who provdes accommodation at 78 properties which are shared ownership properties with a combination of different charges.

    3 tenants pay rent, service charge & supporting people charge
    11 tenants pay rent, leaseholder contribution, service charge & SP charge.
    Of these 14 we pay HB to those who have claimed.

    60 pay service charge & supporting people charge
    4 pay leaseholder contribution, service charge & supporting people charge.
    We do not pay HB to any of these tenants. Those who are eligible for pension credit receive help with the service charge in with their pension credit.

    The landlord has now said that HB should be paid to all their tenants. The tenants own 70%, but do not pay rent on the remaining 30% as this is paid for from a government grant from when the scheme was built (many years ago). The have a leaseholder agreement, not a tenancy agreement.

    Prior to Pension Credit DWP paid the service charge in with Income Support (and then MIG) and we have always treated these tenants like owner occupiers who have to pay a maintenance charge on a property.

    Has anyone come across this scenario and does anyone have any advice on whether these charges should be eligible for HB?


    In every day use, the terms “tenancy” and “lease” tend to mean short-term not usually bought and sold, and long-term often bought and sold respectively. In law, there is no difference. [Strictly speaking I think the tenancy is the legal interest the person has in the property while the lease is the document they sign, or it might be the other way round, or something like that, Charlie John will be able to tell you if you go on the rent liability course next year]. But from 6 months to 999 years, they are all tenants.

    In HB there is a 21-year cut-off – if the lease/tenancy or whatever was orginally for a term of more than 21 years, HB doesn’t cover it but IS/JSA/PC do. However, there is an exception: a Housing Association shared ownership tenancy can be covered by HB. HB can cover all the payments made under the tenancy, whether they are called rent, leasehold contribution, service charge or anything else, subject to the usual exclusions for ineligible services. So if all of these people are shared ownership tenants/leaseholders and the landlord is a housing association, HB can be paid.

    Now it gets messy. There is nothing in the IS/JSA/PC Regs to say specifically that shared ownetship charges cannot be covered by those benefits either. The only way the overlap is catered for is the rule in HB that says HB cannot cover housing costs that are already being met by IS/JSA (see Reg 11(2) in the working age Regs), and the reciprocal rule in IS/JSA/PC that says housing costs met by HB cannot be covered by those benefits. It’s really just a case of who gets there first. There is nothing in the HB(60+) Regs to prevent double provision, but as soon as HB starts the payments will be excluded from PC.

    My suggested approach for 60+ tenants is that if you are satisfied these people have shared ownership leases/tenancies from a housing association, pay HB on all payments except ineligible services, and let DWP make any necessary adjustments at their end to the PC awards.

    For working age tenants, the approach is simpler: you can pay anything that is not already being paid by IS/JSA.

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