LA tenant on HB/CTB lets out room to care leaver as boarder with LA consent. Boarder has little/no income, can she get HB on her eligible rent too? Seems slightly perverse as effectively HB would be paid twice on same property, but then care leaver's gross rent less disregards would be tenant's income and reduce her HB.

Short answer to your question is yes she can.

As above yes you can, very strange situation I have to agree. The way I sort it out in my mind is that the LA tenant is not charging rent but actually being paid by the boarder to share his home and so is at liberty to charge what he feels compensates him for losing the space! As this is used as income by the LA it effectively all comes out in the wash! Mind you with the generous boarder disregards it can prove a good little earner!

I have seen cases where the LA tenant is charging their 'tenant' as much as the LA are charging them and although it appears wrong, it is eligible for HB.

Thanks both. Strange old world innit?

Its fine...

It doesn't matter in law whether the LA tenant is an LA tenant, HA tenant, or owner occ... They are all separate agreements, even whether the LA has granted permission to sub-let matters little... The issue at question is the agreement on the same basis as any landlord/tenant relationship? Does the landlord (in this case th LA tenant) let the room on commercial terms, and at a reasonable rent for the type of property rented? If so the sub-tennant is entitled to HB, irrespective of the amount of floor space lost or anything else, just bear in mind that the deductions for services provided for border meals etc. can be quite high...