Since 2013, Housing Benefit rules for working age tenants mean they get less benefit if they have at least one spare bedroom. Some tenants affected by this may consider renting out a spare room to boost their income. A room being used by someone isn't treated as spare, so Housing Benefit wouldn't be reduced.
Taking on a lodger
A lodger is someone who rents a furnished room in your home. If you are a secure tenant, you have a right to take in lodgers as long as it doesn't overcrowd your home. Introductory and demoted tenants do not have this right.
You do not need our permission first, but bear in mind that it may affect any benefits you receive. You must give us the name and details of any lodger. Your tenancy agreement says you have to tell us who is living in your home.
A lodger is not the same as a sub tenant. A sub tenant has more rights. You must not take in a sub tenant or sublet any part of your home without our written permission.
How a lodger might affect your Housing Benefit
You must tell our housing benefits team and the Department for Work and Pensions if you take in a lodger. If you don't, you may be given too much benefit, which you will have to repay. If you fail to declare additional income, it may also be regarded as fraud and you could risk prosecution.
If the person living with you is an adult relative (parent, parent-in-law, son, daughter, son-in-law, daughter-in-law, stepson or stepdaughter, brother, sister or partner) they will not be classed as a lodger, but you must still tell us.
You may get less housing benefit and it could also reduce any disability benefit you receive.
The effect on your council tax
Your council tax will only be affected if you were receiving a discount as the only adult in your property before you took in a lodger. If the number of people living in your home changes, you must tell us.
The effect on your tax
You do not have to pay tax on rent you get from a lodger up to £7,500 a year. If you earn over £7,500 a year from your lodger's rent, you must tell your tax office.
You can find more information on renting a room in your home on the Government website.