We would like to see tax relief for landlords who let to benefits tenants

We would like to see tax relief for landlords who let to benefits tenants

10:36 AM, 18th November 2022, About 2 years ago 5

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It is very welcome news that the Chancellor has confirmed that the government will uprate benefits by inflation with an increase of 10.1%, giving families on Universal Credit a boost of £600 per year. We would also like to have seen some form of tax relief for landlords who let to tenants in receipt of benefits to encourage them to remain in the sector.

We have seen a significant increase in landlord clients contacting us who are concerned about their tenants’ ability to pay rent. Some tenants who are in receipt of Universal Credit are cancelling their Alternative Payment Arrangements (APA) due to the cost of living crisis, forcing landlords to consider eviction as their only option.

If a tenant is having difficulty meeting their rent payments, landlords can put a request in to the Department for Work and Pension (DWP) to set up an APA, meaning the housing element of the tenant’s Universal Credit payment is paid directly to the landlord. Many tenants find this an easier way to help them budget. Typically, APAs have a significant impact on limiting arrears and also help to sustain the tenancy as landlords have the reassurance that they will receive rent payments.

We’re working with more and more landlords and tenants to ensure they are claiming the benefits they are eligible for and looking at how they can budget to ensure they meet their rent payments and maintain their tenancy.

Over the last few months this has become increasingly challenging. There is no doubt that rising inflation is increasing risk and severity of poverty. However, the chronic shortage of social housing means thousands of tenants are reliant on private landlords, but this is only feasible for landlords whose tenants are able to meet payments. Landlords are facing their own financial challenges due to increased taxes and mortgage hikes, and we are seeing a reduction of landlords who want to operate in this sector.

The government has been too quick to drive private landlords away without considering the impact on the very people it claims to be supporting – tenants. The fact is, until we can build more, our country needs private landlords, the vast majority of which provide good quality housing in desirable locations.

Sherrelle Collman, Managing Director of Caridon Landlord Solutions


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Judith Wordsworth

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11:01 AM, 19th November 2022, About 2 years ago

I have been saying this to my MP for the last 5 or more years. He has even put my idea before the Treasury Minister responsible on supposedly several occasions.
My suggestion was: property rented to those on housing benefit for a minimum of 10 years, the property should be / would be then £0 or £5% rated for CGT on sale.
Not surprisingly nothing was forthcoming from the Treasury Minister.

Tim Rogers

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13:37 PM, 19th November 2022, About 2 years ago

I agree that something needs to be put in place for CGT when inside the benefits environment.

I'd also suggest that CGT should be removed if a rental property is being sold/gifted to tenants.

Old Mrs Landlord

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14:01 PM, 19th November 2022, About 2 years ago

It's the failure to uprate LHA that's the greatest problem. Even bringing it more into line with local rents would be a great help in our part of the country. There are regions where rates of Housing Benefit are close market rents but in others they fall hundreds of pounds short, so that those of us who took on tenants when there was little difference are now stuck with decent tenants for whom we have been unable to raise rents for many years. No wonder so many are served S21s when landlords' costs rise.

Max Power

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15:53 PM, 19th November 2022, About 2 years ago

There should be a tax relief for landlords that is comparable to corporation tax because in the end renting a property is similar to owning a business. With much tax relief opportunities having been diminished or eliminated entirely over the last few years, it has become increasingly difficult to remain lucrative as a landlord forcing many to either increase rent or sell the property they owe altogether both of which have a negative impact on tenants. Something has to change.

Katy Ann

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11:27 AM, 20th November 2022, About 2 years ago

Reply to the comment left by Judith Wordsworth at 19/11/2022 - 11:01Interesting idea. Do you think that would mean some landlords would serve notice on tenants who’d been claiming benefits but then found work? And if so, that might indirectly result in a disincentive for benefit claimants to seek work, if they thought that them coming off benefits might mean them losing their home?

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