Rent a room relief extended to those on welfare – Naughten

In Families, Local Issues, News, Older People, Posts by Topic by Denis Naughten

Denis Naughten TD has welcomed the extension of the “rent a room” relief to people in receipt of Social Welfare who wish to rent out a spare room in their home.

For the next two years a person renting a room in their home to a person who is not an employee, or an immediate family member, will have up to €14,000 of rental income disregarded in the assessment of means to qualify for weekly social assistance payments, increases for qualified adults, the Working Family Payment and Supplementary Allowance.

This will be of particular benefit to older people who can now receive €269.23 in weekly rent for a room, equal to €14,000 per annum, without it having an impact on their Non-Contributory State pension or the spouse or adult dependent of a contributory pensioner.

“It could also provide much needed additional income to families trying to cope with the increase in the cost of living if they have a spare room,” said Denis Naughten.

“Up to now the rent-a-room scheme allowed a taxpayer to earn up to €14,000 per year tax-free if they rented out a room in their home to private tenants, but those on a mean-tested social welfare payment had that rent deducted from their payment,” stated Denis Naughten.

“This effectively meant that any person in receipt of a mean-tested social welfare payment was renting out their spare room for free while a taxpayer could earn €14,000 tax free, which made no sense in the middle of a housing emergency,” said Denis Naughten.

As a result, the Regional Group of Independent TDs put forward a proposal last month, taken up by Government, to change the Social Welfare means assessment to allow Social Welfare recipients, many of them older people with a spare room, to be able to hold on to the rent.

While renting out a room that is part of a person’s home is not covered by landlord and tenant law, depending on their circumstances the tenant(s) may qualify for the Housing Assistance Payment (HAP) from the local Council.

The rent relief for welfare recipients has initially been introduced for a two-year period up to March 2025, and it is hoped it will not only provide vital housing accommodation but may also be of benefit to the older person by providing companionship.

“Having another person in the spare room also provides an overnight presence in the home for security and peace of mind for an older person, and I hope that community groups, active retirement groups and not-for-profit organisations can now embrace this new incentive by assisting older people in selecting a suitable tenant,” concluded Denis Naughten.


Editor’s note:

Statutory Instruments

Dept of Social Protection SI 160

Dept of Social Protection SI 161

Regional Independent TDs housing proposals adopted by Government last month. The objective behind our eight proposals is to secure rental accommodation for those facing eviction, provide relief for small landlords to ensure they remain within the market and ensure affordable housing is made available to young couples and families:

  1. Remove barriers to older people in long term nursing home care who wish to lease out their homes effective from the 1stof May 2023.
  2. Increase the grant rates for the Croí Cónaithe refurbishment scheme to reflect current building costs, effective from the 1stof May 2023.
  3. The Croí Cónaithe refurbishment scheme needs to be extended to include properties which are made available for rent and not just owner occupied, effective from the 1stof May 2023.
  4. Revise the Croí Cónaithe scheme to include properties built prior to 2007, effective from the 1stof May
  5. Extend the rent-a -room relief scheme to people receiving social welfare payments who rent out a room so that they do not lose supplementary benefits such as the medical card effective from the 1stof May 2023.
  6. Introduce in Budget 2024 of a tax relief scheme to take effect in the current tax year for small landlords.
  7. Amend the Housing Assistance Payment (HAP) to guarantee payment to landlords where the tenant defaults on payment of contribution to HAP effective from the 1stof May 2023.
  8. Immediately engage with site owners who have obtained planning under the Strategic Infrastructure Development and that have not yet commenced building due to viability issues to ensure immediate commencement of these projects under the affordable housing scheme.