Can I secretly rent my house to my son

[Pinkpanther111]

i am wanting to rent a bungalow. Instead of selling my house my son will pay rent to me.
can I do this without telling anyone?

TIA

To prevent income tax liability he should pay his rent to your landlord but live in your house.

Why wouldn't you just do it above board?
Become landlord, take insurance out and put his deposit in scheme. It keeps everyone right. You can charge him what rent you like.

But wouldn't that break landlord agreement as he isn't the tenant?

Yes I meant sell a proportion of it using a loan from OP, then the instalments would be tax free as loan repayments rather than rent. As an owner he can be responsible for maintenance, repairs, buildings insurance rather than OP paying for everything out of taxable income.

Can he rent a bungalow and you just do a house swap? It'll be against the terms but I doubt anyone will care.

Not so, Cars4Gov; it's perfectly possible to get housing benefit when renting from a relative, but it does have to be a properly constituted tenancy and not what they call a "contrived" one

For example they ask whether the home was advertised on the open market, what'll happen if the tenant defaults on rent, who it was who instigated the arrngement and so on

You'll need to get landlord's insurance, tell your mortgage provider if you have one and do a tax assessment each year for the income. You'll need to comply with all the legislation that comes with being a landlord too.

I don’t think you will be able to get a proper answer, without explaining who you want to keep it a secret from. But as others have said, at the very least you will likely have to tell your mortgage lender (if you have a mortgage) and declare the rent you recieve to HMRC as it constitutes income.

OP will need to tell her bank (ask in fact) and change the mortgage to a BTL mortgage. Many lenders will NOT lend if a family member resides in the rented house.

Also OP will need to change the house insurance to landlord insurance rather than owner occupier.

OP will need to do all the usual gas and electrical (and Legionnaire's etc) checks and serve all the usual paperwork else the mortgage and insurance won't be valid.

And yes declare the income via an annual tax return.

If you mean sort of sneaky, cash in hand thing for whatever reason, I think it is a bad idea. One, you'll probably get found out / reported and end up in trouble. Two, if your son ever finds that he needs housing benefits, he will have no evidence that he ever paid you rent, so I think they will not help him. This happened to someone I know who stayed for free in one of his mum's properties and then he wanted housing benefit. Obviously (and rightly so), they said no as he never paid any rent. So I imagine any under the table rent situation would be the same

Probably, although I don't know how it would work if she still legally owns the house. Maybe a tax or mortgage job.

Why doesn't your son rent a bungalow and you just swap homes: if he's not paying you rent, then it's not income which needs to be declared by you.

Years ago I got evicted by a bank because the actual homeowner wasn’t allowed to rent the house to anyone else, it was in the terms of their mortgage.

You can rent your home to anyone you like provided the mortgage lender agrees and you inform the HMRC. You’ll both also have to register your new addresses for council tax and voting.

Why not get your son to pay your rent while you continue to pay your mortgage?

Who do you want to keep it a secret from and why? No one can answer if you don't divulge this as we can't accurately assess the liability.

You need to give more info here.
Why does it have to be in secret? What are you hiding, and who from?

It completely depends what you are trying to. Ensure your property is legally up to standard for renting, declare you are renting (if necessary) to your mortgage provider and insurance company etc but not tell your daughter because she will feel you are favouriting her brother and turn it into a big issue? That’s something you can do.

Pretend not to be renting to break the law and/or commit fraud? No.

Even if it’s for free you are still a landlord and still required to comply with all the landlord rules and regulations (which are about to be increased massively).

Surely that is if there is a tenancy agreement?
What about people who let a relative live rent free in a property? No agreements or anything.

OP not going to come back and enlighten everyone?

What’s the point?

Well spotted- the tax free advice is totally rubbish.
Look at trouble Rachel Reeves got into recently and she was trying to do everything correctly. I am an accidental landlord- there is so much legally you must do. HMRC, tax return, gas cert, councl licence if needed, EICR cert, EPC, smoke and CO alarms, tested, timely deposit certification, immigration checks etc etc. There's more, and recently AML checks too for all landlords.

It's not your son reporting you you probably need to worry about, it's anyone else who finds out and wants to get you into trouble.

Define secretly? HMRC need to know, you need a proper AST to safeguard both parties.

I mean you could try but you'll both be in the shit if someone finds out like your landlord, your mortgage provider, HMRC...

So it's up to you really.

Could your son pay the bungalow landlord instead? That way you pay your mortgage and he pays your rent and you just swap houses.