Taking in a lodger and subletting your home

Permission

You must ask our permission so we can make sure your home would not become overcrowded.

If you want permission to take in a lodger, sublet part of your home or change the members of your household, call 0191 525 5000 and select option 4.

If you sublet your entire home or do not ask our permission, you will breach your tenancy agreement and may lose your home.

Rent a Room Scheme

The Rent a Room Scheme lets you earn up to £7,500 a year tax-free if you let a furnished room in your home. Find out more about the Rent a Room Scheme.

Lodgers, sub-tenants, family members and friends

You may want to do a background check on lodgers or sub-tenants. This may include:

• getting a reference from their previous landlord
• checking if they can afford their rent

We recommend you have a contract with lodgers and sub-tenants that you both sign and agree to follow. If you want your lodger or sub-tenant to leave your home, you must give them a reasonable amount of notice.

You will usually share your kitchen and bathroom with anyone who lives in your home. You can decide if you want to offer services like meals, laundry and cleaning.

If you want them to leave your home, you are responsible for this and may need to get legal advice and take them to court to evict them.

Lodgers

A lodger rents a furnished room but does not have exclusive use of any part of your home. They do not have the right to put a lock on their room and you do not need their permission to enter it.

Sub-tenant

A sub-tenant does have exclusive possession of part of your home. They have the right to put a lock on their room and you need their permission to enter it.

Family members and friends

Family members and friends who live with you are members of your household not lodgers, even if they pay rent.

Bills and benefits

We recommend that you get advice about how rental income or changing who lives with you could affect your bills and benefits.

You should contact the Department for Work and Pensions and Sunderland City Council and let them know about any income or changes to your household. If you do not tell them, you may have to pay money back or they may prosecute you for fraud.

Bills

Having more people in your home usually increases how much you spend on:

• electricity
• gas
• water

Council Tax

If there are 2 or more adults living in your home, another adult moving in will not change how much Council Tax you pay.

If you live alone and get the single person discount Council Tax, you will have to pay full Council Tax if another adult moves in. Unless the lodger, sub-tenant, friend or family member:

• is in full-time education
• gets certain benefits
• already pays Council Tax somewhere else

You should call Sunderland City Council on 0191 520 5551 to find out if your Council Tax payments will change. If you do not tell them, you may have to pay money back or they may prosecute you for fraud.

Housing Benefit and Universal Credit

If you are a working age tenant and you get Housing Benefit or the housing element of Universal Credit, you will get:

• 14% less benefit if you have one more bedroom than you need
• 25% less benefit if you have two or more bedrooms than you need

This is referred to as the ‘Bedroom Tax’, ‘under-occupation penalty’ or ‘removal of the spare room subsidy’.

If you rent out your spare bedrooms and get Housing Benefit, your Housing Benefit will not be reduced by 14% or 25%. But any rental income more than £20 a week will affect how much Housing Benefit you get.

If you rent out your spare bedrooms and get Universal Credit, your Universal Credit will still be reduced by 14% or 25%. But any rental income is ignored and does not affect how much Universal Credit you get.

If a friend or family member moves in and does not pay rent, you may still get less Housing Benefit or Universal Credit. This is because they are expected to contribute to your rent.

If you would like our help, you can talk to or book an appointment with our Money Matters Team.

Home contents insurance

Change to your household contents may affect your home contents insurance policy.

You may need to:

• get a new policy
• change the value of the goods you insure
• tell your lodger, sub-tenant or family member that they need their own contents insurance