Rent arrears caused by Housing benefit issues

Housing benefit questions often arise in rent arrears cases. It may be that the client is not aware of entitlement to Housing benefit.

One of the first things to do for a client faced with eviction for rent arrears is to check the housing benefit entitlement. In cases where the client is due in court or tribunal on the same day it may be appropriate to ask for a continuation for a couple of weeks until the client's housing benefit entitlement can be properly checked.

This content applies to Scotland

Delays in payment

If the rent arrears are all or in part due to a delay in the award of housing benefit, s/he should be advised that the local authority has a statutory duty to make an interim payment of housing benefit if it cannot determine the claim within 14 days. [1] There is no need for the claimant to make a separate application. [2] The local authority can only refuse to make this payment where the claimant has failed, without good cause, to supply information reasonably required. [3] In practice, it will be very difficult for a local authority to blame the claimant for a failure to supply information. The claimant should not be held responsible, for example, for the failure of the benefit agency to supply information. Local authorities often overlook this important part of the law (when they are aware of it). Advisers should insist on an interim payment being made. Where the local authority refuses to make payment, judicial review is the correct remedy. [4] Claimants should also be advised of their right to make a complaint to the Ombudsman. [5] For more information, please see the section on complaints to the Ombudsman.

Tenant being pursued on Ground 8 due to delay in housing benefit

In a situation where an assured or short assured tenant is awaiting a delayed payment of housing benefit and her/his landlord is pursuing her/him on ground 8 (three months' or more rent arrears), a delayed payment may be a defence in court. [6] Since 2 July 2004, provided the delay or failure to pay Housing Benefit was not the fault of the tenant, the tribunal has the discretion not to make an order under ground 8 unless it would be reasonable to do so. [7]

If a decree is granted against a tenant and that tenant has not appeared at tribunal, been represented or stated a defence, it may be possible for the eviction order to be recalled if the housing benefit problem is resolved before the eviction is actually carried out.

The non-dependant deduction

The non-dependent deduction, 'in practice a major source of rent arrears', [8] is applied when certain groups of people live in the same house as the housing benefit claimant. Depending on that person's age and income, a certain amount will be deducted from the claimant's benefit, the expectation being that the person living in the claimant's house makes up the rent shortfall. Most commonly this occurs when an adult son or daughter continues to live in the parental home. For more information on non-dependant deductions, please see the section on calculation of Housing Benefit.

Advisers should note that a non-dependant deduction can only be applied for someone who 'normally resides' with the claimant. In cases such as 'giro drops' or other circumstances where the house has been used as a 'care of' address, the application of a non-dependent deduction may well be open to challenge. [9] Before pursuing this course of action, advisers should discuss with the client any possible issues around fraud that may arise. As such a challenge is likely to involve a lengthy appeal process, a sist or a lengthy continuation should be requested.

Failure to claim housing benefit in time and backdating

Where rent arrears reflect a failure of the tenant to claim Housing Benefit, it may be possible to get the benefit award backdated. A working age claimant can only apply for backdated benefit for a period of up to one month a if s/he can show 'good cause' for the failure to claim earlier. [10] If the claimant is over the age of 60, her/his claim can in most circumstances be automatically backdated for up to three months with no requirement to demonstrate good cause. [11] A specific application for backdating should be made. If the application is refused, the appeals/review process may have to be followed to a tribunal. If the claimant's case comes to court or tribunal whilst the Housing Benefit appeal/review process is underway, a sist or a lengthy continuation should be requested. For more information on backdating claims, please see the section on backdated claims.

Asylum seekers who are notified of refugee status after 14 June 2007 will not be able to apply for housing benefit to be backdated. [12] Instead, they, and those granted humanitarian protection (and their respective dependants), can apply to the Border and Immigration Agency for an integration loan.

A claim for Housing Benefit will generally be treated as being made on the date on which the claimant notified the local authority or appropriate Department of Work and Pensions office of her/his intention to claim housing benefit. [13] A claim form will be issued to the claimant, which must be completed and returned to the relevant office within one calendar month, or such longer period as the local authority deems reasonable. [14]

Problems with the date of claim may arise if there is a disagreement about whether or not the claim form was actually submitted. A tenant may submit a claim form then not hear for months and assume that the rent is going directly to the landlord, only for it to transpire that the housing benefit department has never received the claim form. In such situations, the tenant suddenly finds her/himself with a few months' rent arrears.

In cases where the tenant asserts that the application was submitted within the required time period, a request for backdating of the claim is not necessarily the appropriate point to appeal on. The dispute should not be about whether the tenant can show 'good cause' for making a late claim, but about whether the tenant made the claim on time; however, it may be advisable to submit a backdated request as well, on the grounds that the claimant reasonably believed that s/he had made a claim, as a safeguard against losing the other arguments.

If the claimant has experience of previous delays with the housing benefit system, it could be argued that it was not unreasonable for the claimant not to have acted when s/he had not heard from the local authority. A claimant who is renewing her/his claim for housing benefit and has always returned the forms and requests for information in the past, can argue that it is credible that s/he sent the form as s/he has always done so in the past.

If the appeal goes to tribunal, the onus will be on the tenant to show that s/he did send the form. Local authorities may produce evidence of the office systems in place for receiving post, recording its receipt and matching it to the relevant file. Some reports on the Benefit Fraud Inspectorate website suggest that some local authorities have poor record management systems. A report of this kind could be used to back up a suggestion that a form might have been received but not recorded.

Housing benefit overpayment or rent arrears

Rent arrears may arise following an overpayment of Housing Benefit.

Tenants of registered social landlords

The local authority can recover an overpayment by adjusting the rent account. The overpayment must be identified separately and should not represent rent arrears. [15] Any action to recover the overpayment should be kept separate for any possession action on the grounds of rent arrears. [16] A local authority tenant who has an overpayment and rent arrears would be advised to prioritise making payments to the rent arrears to avoid the possibility of being evicted. [17]

The local authority also has the option to recover the overpayment directly from the tenant or from the tenant's ongoing benefit. If the overpayment is recovered from ongoing benefit, the tenant is responsible for making up the shortfall. If the tenant does not meet the shortfall, resulting in the rent account falling into arrears, these arrears would constitute grounds for eviction. [18]

Private sector tenants

There are regulations that dictate when an overpayment can be recovered from a landlord. For more information, please see the section on overpayments of housing benefit.

If an overpayment is recovered from a landlord who has committed an offence or has agreed to pay a penalty to avoid being prosecuted, that overpayment shall not result in rent arrears. The tenant must be treated as having paid her/his rent. [19] There are currently no rules about how any other overpayment recovered from a landlord should be treated and therefore it is likely to be treated as rent arrears.

Last updated: 27 May 2019

Footnotes

  • [1]

    reg.93(1) Housing Benefit Regulations 2006 SI 2006/213, reg.74(1) The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006, SI 2006/214

  • [2]

    R v Haringey LBC ex p. Ayub (1993) 25 H.L.R. 566

  • [3]

    reg.93(1) Housing Benefit Regulations 2006 SI 2006/213, reg.74(1) The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 SI 2006/214

  • [4]

    Mitchell J, 'Eviction and Rent Arrears', Shelter, para. 5.25

  • [5]

    for Ombudsman case references see 'Eviction and Rent Arrears', by J. Mitchell, para. 5.25

  • [6]

    sch.5 Housing (Scotland) Act 1988 as amended by s.12 Homelessness etc (Scotland) Act 2003

  • [7]

    s.18(3A) Housing (Scotland) Act 1988 as amended by s.12 Homelessness etc (Scotland) Act 2003

  • [8]

    Mitchell J, 'Eviction and Rent Arrears', Shelter, para. 3.32

  • [9]

    see 'Non-dependent deductions, residence tests and the burden of proof', Bob Hay, SCOLAG No. 246

  • [10]

    reg.83(12)(b) The Housing Benefit Regulations 2006 SI 2006/213 as amended by The Social Security (Miscellaneous Amendments) (No.4) Regulations 2008 SI 2008/2424

  • [11]

    reg.64(1) The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 SI 2006/214 as amended by The Social Security (Miscellaneous Amendments) (No.4) Regulations 2008 SI 2008/2424

  • [12]

    s.12 Asylum and Immigration (Treatment of Claimants, etc.) Act 2004

  • [13]

    reg.83(5)(d) The Housing Benefit Regulations 2006 SI 2006/213

  • [14]

    reg.83(5)(d) The Housing Benefit Regulations 2006 SI 2006/213

  • [15]

    R v Haringey LBC ex p. Ayub (1993) 25 H.L.R. 566

  • [16]

    4.101 HB/CTB Overpayments Guide

  • [17]

    4.104 HB/CTB Overpayments Guide

  • [18]

    Aberdeen City Council v McCarthy 2004 Hous. L.R. 53

  • [19]

    reg.107 Housing Benefit Regulations 2006 SI 2006/213; reg.88 Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 SI 2006/214