Landlord receives £10K overpayment demand due to tenant moving to new address
Housing Benefit Overpayment

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146 Posts
3 years ago

One of my landlord clients recently received a demand for a £10,000 Housing Benefit overpayment.

The overpayment was caused by a failure on the part of both the tenant and my client reporting his change of address, to another of my client's properties, to the Council's Housing Benefit department.

As I'm sure you're aware, when a tenant makes a claim for Housing Benefit (LHA) they, amongst other things, agree to notify the Council of any change that could impact on the level or duration of their award. Failure to comply with this obligation would invariably result in any overpayment being recoverable. However, when payment of the HB/LHA is made to the landlord or agent, this also creates a similar obligation, on their part, to report any material changes.

In this case, both accepted they were to blame, but as my client had received payment, the Council decided to pursue the landlord, rather than the tenant, for recovery of the sum.

However, in this case, the tenant in failing to report the change, also received no HB/LHA for the new address. Had he done so, he clearly would have received payment at a level almost identical to what he had previously received. So, in this case, I challenged the local Council's decision, on the basis there was no actual overpayment, as the the tenant had an underlying entitlement to HB/LHA, at the new address, which the Decision Maker had not factored into his original decision.

The Council, after some weeks of deliberation agreed, by firstly awarding HB/LHA at the new address and offsetting the sum, in question, against the original £10,000 overpayment leaving NIL to pay.

You could be forgiven for thinking this is rather a unique case. It's not. This scenario plays out on an all too regular basis, with in most cases, councils pursuing the landlord for recovery of the overpayment caused by the tenant no longer being resident at the original address. The offsetting rule only works where the same council administers HB/LHA for both addresses and there's a number of conditions attached. One of the most common uses of the rule is where someone moves from one room in an HMO to another, fails to report the change and it's discovered later by the Local Authority.


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