Chapter 5: The Qualifying Landlord

Managing Housing Benefit Claims in Supported Housing | Part B: The Case Law

In brief

  • Exempt accommodation must be provided by a qualifying body: a non-metropolitan county council in England, a housing association, a registered charity or a voluntary organisation. That body, or a person acting on its behalf, must also provide the claimant with care, support or supervision.
  • Every qualifying landlord must be not-for-profit. The test is about the landlord itself. Contractors, lessors and support partners making a commercial profit do not, by themselves, stop the landlord qualifying (Wirral BC v MF [2014] AACR 12).
  • A housing association does not need to be registered with a regulator to qualify. Registration is evidence, not a requirement.
  • The accommodation is provided by whoever has the right to let it and is entitled to the rent. Arranging or nominating to accommodation is not providing it (East Hertfordshire DC v KT [2009] UKUT 12 (AAC); Chorley BC v IT [2009] UKUT 107 (AAC)).
  • Care, support or supervision from a third party counts only if the landlord has engaged that party to provide it on the landlord’s behalf. A partnership or joint venture in which each party acts for itself is not enough (R(H) 2/07).
  • Lease-based models can be legitimate. The questions are whether the landlord genuinely runs the scheme as landlord, and whether the arrangement was created to take advantage of the Housing Benefit scheme (FYE v Middlesbrough CC and GPZ v Sunderland CC [2026] UKUT 157 (AAC)).

The law

The definition of exempt accommodation is in paragraph 4(10) of Schedule 3 to the Housing Benefit and Council Tax Benefit (Consequential Provisions) Regulations 2006. It means accommodation:

“provided by a non-metropolitan county council in England …, a housing association, a registered charity or voluntary organisation where that body or a person acting on its behalf also provides the claimant with care, support or supervision”

The definition has three parts, and each must be met:

  1. the landlord is one of the listed bodies (5.1)
  2. that body provides the accommodation (5.3)
  3. that body, or a person acting on its behalf, provides the claimant with care, support or supervision (5.2)

The test applies to the claimant’s own accommodation, not to a building or scheme as a whole (CH/1289/2007).

5.1 Housing association, RP, registered charity, voluntary organisation, county council

Housing association. Regulation 2(1) of the Housing Benefit Regulations 2006 adopts the definition in section 1(1) of the Housing Associations Act 1985: a society, body of trustees or company that is established for the purpose of, or whose objects or powers include, providing, constructing, improving or managing housing, and that “does not trade for profit” or whose rules limit interest and dividends to a prescribed rate.

  • A housing association does not need to be a registered provider. Unregistered housing associations can qualify (DWP guidance, para 98).
  • Registration with the Regulator of Social Housing is not conclusive either way. In England, for-profit registered providers exist and cannot meet the definition (DWP guidance, para 97).
  • The difference between registered and unregistered landlords matters for subsidy, not for whether the accommodation is exempt. Chapter 2 explains this.

Registered charity. A charity registered with the Charity Commission or the Scottish Charity Regulator. Charities that are exempt from registration in England and Wales can still be treated as registered charities (DWP guidance, para 100). In Scotland, all charities must register (para 101).

Voluntary organisation. Regulation 2(1) defines this as “a body, other than a public or local authority, the activities of which are carried on otherwise than for profit”. It can include community interest companies (CICs) and community benefit societies (DWP guidance, para 103). Being a CIC does not guarantee that a body meets the definition, and the council must look at the evidence (para 108).

Non-metropolitan county council in England. These are upper-tier councils that do not administer Housing Benefit themselves (DWP guidance, para 93). They rarely act as landlords of supported housing.

The not-for-profit test. The leading decision is Wirral BC v MF (also known as Wirral BC v Furlong) [2013] UKUT 291 (AAC), [2014] AACR 12. It was decided by the Chamber President and is a reported decision. The Upper Tribunal held:

  • The profit wording in the housing association and voluntary organisation definitions means the same thing, the “non-profit making condition” (para 36).
  • The condition is about the landlord itself. It is “an obvious possibility, if not inevitable” that a provider will contract with property owners and service contractors who make a profit, and that alone cannot stop the provider qualifying (paras 41 to 44). A statement in the DWP guidance at the time, that the organisation’s arrangements must make it impossible for anyone to profit, was “simply wrong” (para 44).
  • Connected companies are separate legal entities. Where arrangements are bona fide and commercial, with no overcharging and no disguised profits, the contractors’ profits are not the landlord’s (paras 49 to 58).
  • Making a surplus does not mean trading for profit. What matters is what the body can and does do with the surplus (para 64).
  • Councils should start with the landlord’s constitution and accounts, but may look at its actual activities (paras 66 to 76). Any concerns at that second stage should be clearly identified and particularised (paras 80 and 81).

SHP’s position. The current DWP guidance still says that the way an organisation is set up “should prevent any person, organisation or body from making a profit from its operations or the sale of its assets” (para 104). Read alongside Wirral BC v MF, this can only mean the landlord and those who control it. It does not mean the landlord’s contractors, lessors or partners. Where the guidance and the case law differ, the case law applies (Chapter 4).

The indicators in paragraph 105 of the guidance are a useful checklist: a formal constitution; registration with a relevant regulator; no dividends or profit taken from operations or from disposal of assets; no disguised payments to directors or others; and an asset lock.

5.2 Who is “acting on behalf of” the landlord: managing agents and support partners

Care, support or supervision from a third party. The landlord does not have to deliver the care, support or supervision itself. A support partner can provide it, but only if it provides it, or at least some of it, on the landlord’s behalf.

  • The landlord must either provide the care itself or have contracted for it to be provided on its behalf. Strict agency may not be needed, but the landlord must at least have engaged the provider to provide the care for it (R(H) 2/07, as summarised in CH/760/2008, para 12).
  • In R(H) 2/07, a tripartite agreement between the property owner, the landlord and the support provider was a joint venture in which each party acted as principal. Clause wording saying the provider acted “on behalf of” the landlord was “wholly at variance with the reality of the situation”. The council, not the landlord, paid the support provider and could replace it. Support was therefore not provided on the landlord’s behalf.
  • The words “or a person acting on its behalf” mean acting on the landlord’s behalf in providing the care, support or supervision (R(H) 6/08).
  • It is not enough that the support benefits the landlord or makes the scheme viable (R(H) 2/07).
  • A person who supports the claimant independently, for example out of friendship or loyalty to the claimant, is not acting on the landlord’s behalf (CH/760/2008).
  • Where the landlord itself provides support, it need not be the main provider. Its support must be more than minimal (R(H) 7/07), and Chapter 8 covers that test.

This is why the service level agreement between the landlord and the support provider matters. It is good evidence of the relationship, but it is the reality of the relationship, not the label, that counts.

Managed properties are different. For the “managed properties” category of specified accommodation, care, support or supervision does not need to be provided by or on behalf of the landlord (DWP guidance, para 79). Where support is commissioned separately, for example by social care, the accommodation may not be exempt but may still be specified accommodation. Chapter 2 explains the categories.

Managing agents. A managing agent is not the landlord. The landlord cannot be “a managing agent or an organisation which only provides the care, support or supervision” (DWP guidance, para 90). Where a housing association or charity is only acting as managing agent for a profit-making owner, the accommodation cannot be specified accommodation (para 90).

The guidance

5.3 Lease-based models and the separation of owner, landlord and support provider

Who provides the accommodation. The accommodation is provided by “the owner or other person (e.g. a tenant) who, but for the grant to the claimant of the tenancy or licence, would have the right to possession”, who can permit occupation and is entitled to the rent (East Hertfordshire DC v KT [2009] UKUT 12 (AAC), para 15). Organising or arranging for accommodation to be provided by someone else “does not amount to providing it” (para 17).

In Chorley BC v IT [2009] UKUT 107 (AAC), a housing association held the lease. The county council had nomination rights and shared financial risk, but it did not provide the accommodation because it had no proprietary interest or entitlement to the rent. The housing association, as leaseholder, provided it.

So a not-for-profit landlord that leases a property from an owner, and grants the tenancy, does provide the accommodation. The DWP guidance agrees: the landlord “can own the freehold of the property or lease it from another organisation/individual” (para 89).

What the DWP guidance says about leases. The guidance recognises the growth of lease-based schemes, often on long, full repairing and insuring leases with index-linked uplifts, and the governance and viability risks the Regulator of Social Housing has highlighted (paras 126 to 128). It says:

  • the same rules apply to lease-based claims as to any other specified accommodation claim (para 129)
  • councils can look at the relationship between the landlord and the property owner, to see whether it is commercial or whether the scheme may have been arranged to take advantage of Housing Benefit (para 130)
  • where people with significant control of the landlord have an interest in the property, councils may ask how conflicts of interest are managed (para 131)
  • where lease terms leave the landlord without the freedom to carry out a landlord’s usual duties, such as setting its own rents, the landlord may be treated as a managing agent; if the owner is profit-making, the accommodation then cannot be specified accommodation (para 132)
  • lease-based schemes operated with good governance and financial viability can be legitimate (para 133)

SHP’s position. Lease-based supported housing can be legitimate when it is done properly. The legal questions are the ones the case law sets:

  • Is the landlord the provider? Does it hold the interest in the property, grant the tenancy, collect the rent and carry out a landlord’s functions (East Hertfordshire DC v KT; Chorley BC v IT)? Para 132 of the guidance applies this test: a landlord with no real control is in substance a managing agent.
  • Is the landlord not-for-profit? Third parties making commercial profits through bona fide, arm’s length arrangements do not stop it qualifying (Wirral BC v MF).
  • Was the liability created to take advantage of the scheme? This is the contrivance test in regulation 9(1)(l), covered in Chapter 11. In FYE v Middlesbrough CC and GPZ v Sunderland CC [2026] UKUT 157 (AAC), the Upper Tribunal upheld a First-tier Tribunal finding that tenants’ liabilities had been created to take advantage of the scheme. It confirmed that this involves findings of fact and evaluative judgment, and that evidence from council decision-makers was not required.

The warning signs in lease-based models are well known. They include rents driven by head lease costs rather than local rent levels; long, inflexible leases that pass all the risk to the provider; no funding plan other than Housing Benefit; providers kept solvent by loans or “donations” from the owner; and the same people controlling, funding and profiting from several linked entities (SHP, The End of the Property-Led Exempt Accommodation Contrivance). These signs are a reason for proportionate enquiry, not a finding in themselves. A scheme should not be refused simply because it is funded only by Housing Benefit.

Good practice

For councils:

  • Verify the landlord’s status once, at scheme level, and review it periodically or when something changes. Don’t ask for the same documents with every claim.
  • Check the public registers first: the Regulator of Social Housing, the Charity Commission, OSCR, Companies House and the FCA mutuals register (DWP guidance, paras 97, 99, 104 and 112).
  • Apply the not-for-profit test to the landlord, as Wirral BC v MF requires. Don’t refuse because a lessor or contractor makes a profit.
  • Where there are concerns, identify and particularise them, and give the landlord a chance to respond.
  • Keep the three parts of the definition separate in decision letters: landlord type, provision of the accommodation, and care, support or supervision.

For providers:

  • Be ready to show your constitution, asset lock and latest accounts, and explain any connected parties.
  • Keep leases, management agreements and support agreements consistent with how the scheme really works.
  • If support is provided by a partner, have a written agreement under which you engage the partner to provide it on your behalf, with clear responsibilities, monitoring and payment.
  • Make sure your lease leaves you in control of rent setting, lettings, tenancy management and the support offer.
  • Declare conflicts of interest and explain how they are managed.

Evidence

What is reasonable to request, and when, depends on the landlord’s status and the model. Chapter 13 covers scheme-level evidence in detail.

QuestionReasonable evidenceUsually provided
Is the landlord a qualifying body?Register entry; constitution or articles; for unregistered landlords, a summary of accountsOnce per scheme, then reviewed
Is it not-for-profit?Constitution and asset lock; latest accounts; details of related parties and payments to directorsOnce, then annually or on change
Does it provide the accommodation?Head lease or title; tenancy or licence agreementLease once; tenancy per claim
Does it control the scheme?Lease terms on rent setting, lettings, repairs and termination; management agreementOnce per scheme
Is third-party support on its behalf?Service level agreement or contract; payment arrangements; monitoring recordsOnce per scheme, then reviewed
Are conflicts managed?Statement of people with significant control and their interests; conflicts policyOnce, then on change

Requests should be proportionate. A registered charity or registered provider with published accounts and an asset lock should not need to prove its status repeatedly. More enquiry is justified where the landlord is newly formed, unregistered, closely linked to the property owner, or growing quickly through leased properties.

Finding common ground

Separate status from scheme. Most landlord questions can be settled once, at scheme level. Once agreed, both sides can focus on individual claims.

Use the same tests. Case law provides clear tests for who provides the accommodation, the not-for-profit condition, and support on the landlord’s behalf. Agreeing these at the outset avoids disputes about labels.

Be open about structures. Providers that explain their structure, connected parties, and lease terms up front make it easier for councils to decide. Councils that set out exactly what concerns them, and why, make it easier for providers to respond.

Key cases and cross-references

CasePointChapter
Wirral BC v MF [2013] UKUT 291 (AAC), [2014] AACR 12The not-for-profit test applies to the landlord; bona fide commercial arrangements with third parties do not defeat it5
East Hertfordshire DC v KT [2009] UKUT 12 (AAC) (CH/2726/2008)Accommodation is provided by whoever has the right to possession and the rent; arranging is not providing5
Chorley BC v IT [2009] UKUT 107 (AAC)A leaseholder landlord provides the accommodation; a nominating council does not5, 6, 7
R(H) 2/07 (CH/423/2006)Third-party support must be engaged by the landlord; joint ventures are not enough5, 6
R(H) 6/08“Acting on its behalf” means acting on its behalf in providing the care, support or supervision5
R(H) 7/07A landlord providing support need not be the main provider, but its support must be more than minimal5, 8
CH/760/2008Support given independently of the landlord is not on its behalf5
CH/1289/2007The test applies to the claimant’s accommodation, not the whole building5, 8
FYE v Middlesbrough CC and GPZ v Sunderland CC [2026] UKUT 157 (AAC)Lease-based scheme: liabilities created to take advantage of the scheme5, 11

Sources

Previous: Chapter 4: How to Use Case Law in HB Decision Making

Next: Chapter 6: Care, Support or Supervision (CSS): Meaning

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This manual is licensed under CC BY-ND 4.0: you can share it freely, with credit to SHP, without changes. See Rights and licence. Supported Housing People Ltd, Version 1.0, October 2026.