Rules around renting out your spare room
As part of your tenancy agreement, you’re allowed to take in a lodger or boarder as long as your home doesn’t become overcrowded. Let us know if you do, and we’ll record their details.
If you rent a room out and provide and charge for any meals, the person becomes a boarder.
If your rent doesn’t include any meals, they’re a lodger. If the person moving in is a friend, child, parent, grandparent or other close family member they’ll usually be classed as a non-dependant.
You should check the immigration status of all new boarders and lodgers. Before allowing anyone to move in you should check that they have the ‘right to rent’ and take copies of the documents they supply to prove that they’re in one of the groups below:
- A citizen of the UK, the European Economic Area or Switzerland.
- A person with an indefinite ‘right to rent’: someone with indefinite leave to remain or right of abode in the UK.
- A person with a ‘time-limited right to rent’: someone who has limited leave to remain in the UK or a right to live in the UK under EU law (but not a European citizen because they are exempt).
- A person with a ‘discretionary right to rent’: the Home Office can grant this in certain circumstances.
Under your tenancy agreement, a lodger, boarder or non-dependant shouldn’t put a lock on their door. Access to their room must remain available to you at all times.
It’s good practice if you both agree on a few ground rules. There are example lodger agreements on the internet.
If you wish to take in a boarder or lodger, our Customer Services team can supply you with further information.
If you’re thinking of renting to a close relative, different rules may apply. If the person moving in is a friend or relative who will be helping to pay the rent or bills, and you receive benefits or council tax reduction, you’ll need to let Universal Credit and the council know.
The person moving in will usually be treated as a ‘non-dependant’ (especially if meals are provided) rather than a lodger or boarder. This may affect any single person discount you receive on your council tax, if applicable, and the amount of benefits you may be entitled to.
Non-dependants may not be able to claim any benefits to help with any rent you charge them.
You’re responsible for checking whether a lodger or boarder is suitable to live with, and you can ask for a police check if you have children or vulnerable adults in your home. If your lodger or boarder causes any damage to the property, doesn’t pay you their rent, causes anti-social behaviour or causes any other breaches of the tenancy agreement, you’ll be responsible.
Taking in a lodger or boarder may also affect your home contents insurance policy and how much it costs. Remember to check this.
You must ensure that you do not allow your home to become overcrowded. Our bedroom entitlement guidelines allow one bedroom for each of the following:
- Adult couple
- Any other adult (aged 16 or over)
- Two children of the same sex under the age of 16
- Two children under 10 regardless of sex
- Any other child (other than a foster child or child whose main home is elsewhere).
If you claim Housing Benefit, you can keep the first £20 per week of any rent that a lodger or boarder pays you but 50% of any amount over that will be used as income to calculate your housing benefit entitlement.
For example, if you charge £50 per week rent to a lodger or boarder, you keep the first £20, but £15 (or 50%) of the remaining £30 will be considered as income for your Housing Benefit entitlement which will be reduced.
If a lodger or boarder occupies a spare room then you will no longer be affected by the bedroom tax on the room being rented.
You can get advice from your local Citizens Advice or our Customer Income Advisors about the deductions that’ll be made.
You’ll need to make up this money and pay any difference between Housing Benefit and your full rent to SNG directly
If you claim Universal Credit and take in a lodger or boarder you will still have a reduction to housing costs for the spare bedroom(s), but any rent they are paying you will be ignored.
So, lodgers and boarders are ignored completely for Universal Credit purposes and will not affect the amount received.
Non-dependants, however, will usually affect the housing costs received in Universal Credit by a fixed amount reduction.
If you don’t claim Housing benefit or Universal Credit, you’re exempt from paying tax on income from rent up to £7,500 per year.
As rent from a lodger or boarder is tax free (up to this amount), it also won’t affect any tax credits you are receiving.